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Sweden Cuts GDP Growth Forecasts, Sees Downside Risks
Published by Global Banking & Finance Review®
Posted on May 9, 2025
2 min readLast updated: January 23, 2026
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Global Banking & Finance Review®
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Published by Global Banking & Finance Review®
Posted on May 9, 2025
2 min readLast updated: January 23, 2026
Add as preferred source on GoogleSweden cuts GDP growth forecasts due to global trade tensions, with potential for further economic support. Finance Minister Svantesson highlights uncertainties.
STOCKHOLM (Reuters) -The Swedish government on Friday cut its GDP growth forecast for this year and next, saying global trade frictions had cast a pall over the economy and increased uncertainty about the outlook.
Sweden's economy will expand 1.8% this year and 2.3% in 2026, Finance Minister Elisabeth Svantesson told a press conference.
The government's forecast from April was for growth of 2.1% this year and 2.8% in 2026, though Svantesson had flagged those forecasts would need to be revised lower.
GDP grew 1.0% in 2024.
U.S. President Donald Trump's on-again, off-again tariffs have roiled markets and led the International Monetary Fund recently to sharply cut its forecast for global growth.
Germany, a key trading partner for Sweden, won't grow at all this year, according to the IMF.
While Sweden's economy looks to be in better shape than many others, Svantesson said there was a risk the updated forecasts would need to be lowered further.
"It is a fairly dark picture that we see," she said.
Sweden has strong government finances and is able to do more for the economy if needed, Svantesson said, adding that measures to support growth could even come before the autumn budget, if needed.
Svantesson said expansionary policies adopted in last year's budget and in the spring fiscal bill had put Sweden in a strong position to weather the storm.
"We feel that we are on the right track in the sense that we have a growth budget focused on investments that support companies, investments that make our infrastructure work better... and lower taxes," she said.
On Thursday, the Swedish central bank kept its key rate on hold but opened the door to easier policy ahead if its main scenario of lower growth and more moderate inflation materialises.
(Reporting by Anna Ringstrom and Simon Johnson, editing by Terje Solsvik, Louise Ramussen and Susan Fenton)
The article discusses Sweden's revised GDP growth forecasts due to global trade frictions and economic uncertainties.
Sweden's economy is performing better than many others, but faces risks due to global trade tensions.
Sweden may introduce further economic support measures before the autumn budget if needed.
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