Sweden's gross national product (GNP) unexpectedly fell by 0.8 per cent in July compared to June, according to a preliminary so-called GNP indicator from the Statistics Sweden (SCB).
The analysts had instead expected the growth to increase by 0.1 per cent, according to Bloomberg's compilation.
"Strengthens the picture"
Compared to a year earlier, the Swedish economy declined by 0.9 per cent in July.
It strengthens the picture that the turnaround in the economy has not really occurred, says Nordea's chief analyst Susanne Spector.
But, on the other hand, this GNP indicator should be taken with a pinch of salt. It is shaky and often revised, according to her. No swift double rate cut of 0.50 percentage points from the Swedish Central Bank to boost the economy is likely to happen.
They will proceed with 0.25 per cent rate cuts during the autumn, says Spector.
Worst in a long time
Then, other important statistics, such as the inflation rate on Thursday, will come before the Swedish Central Bank's next interest rate decision. And if, for example, it is also unexpectedly weak, the picture may change together with today's figure, she reasons.
The industry organization for the manufacturing industry, Teknikföretagen, confirms the weak business cycle picture in a new report.
"The business climate for the technology industry in Sweden continued to deteriorate during the third quarter. Despite the pandemic, it was a new ten-year low," writes Teknikföretagen.
But a small glimmer of hope can be seen.
"The order intake did not fall as sharply as during the earlier quarters of the year".
