Sweden's Finance Minister, Elisabeth Svantesson, held a press conference to discuss the country's economic outlook following the Riksbank's decision to maintain interest rates due to rising inflation. Despite a temporary high inflation rate, future rate cuts are anticipated. Svantesson emphasized the need for an expansive budget to combat the ongoing recession and boost household spending, aiming to revitalize the economy and reduce unemployment.
Swedish Finance Minister Unveils Economic Forecast Amidst Inflation Concerns
Swedish Finance Minister Holds Press Conference
Finance Minister Elisabeth Svantesson held a press conference to present an economic forecast.
On Wednesday morning, the Riksbank announced that there would be no interest rate cut this time. Increased inflation is the main reason the rate remains unchanged.
"Inflation has risen more than expected over the summer and is now slightly above the target," the Riksbank stated in a press release following the announcement. At the same time, the high inflation is believed to be temporary, and the Riksbank signals that rate cuts may be possible later in the year.
"Prolonged and Sluggish"
On Wednesday, a few hours after the Riksbank's interest rate announcement, Finance Minister Elisabeth Svantesson presented the Ministry of Finance's latest forecast for economic development.
The government maintains its previous forecast: the economy appears to remain weak. At the press conference, Svantesson said that last year there was a slight improvement, but Trump's tariff announcements disrupted it, creating "uncertainty and pessimism." This led Swedish households to hold back, and they continue to do so.
This is the main reason for the ongoing recession, according to Svantesson.
- "This recession is prolonged and quite sluggish. Had Trump's announcements not come at the beginning of the year, it would have looked different," says Svantesson.
At the same time, the finance minister says that an expansive budget is now required to break the vicious cycle.
- "We will not present a restrained budget. It would be one of the worst things to do in this situation, to be too restrained. We need to get the economy moving and give households a boost," she says.
"Swedes Should Become Richer"
She argues that given the current global situation, it is not entirely surprising that the economic situation looks as it does.
- "It's not surprising that we are in a recession, but it's unfortunate; we want Swedes to become richer," she says.
She also addresses the high unemployment rate in the country.
- "It concerns me. It was high when we took office but remains high. Every figure in the statistics is a person without a job to go to; this is serious."
Svantesson believes that household purchasing power needs to be revived to kickstart the economy and encourage companies to hire more.