The latest data from Statistics Sweden reveals that the country's economy shrunk during the fourth quarter, contradicting earlier claims of recovery. The Gross Domestic Product (GDP) saw a sequential decrease of 0.1 percent in Q4, a rate identical to that of the preceding quarter. An earlier preliminary report had suggested a growth of 0.1 percent.
The GDP also stumbled in Q2 of 2023, showing a decrease of 0.7 percent. This marks the third consecutive quarter of GDP contraction, hence cementing Sweden's ongoing recession. Statistics Sweden attributes this economic slump mainly to a reduction in gross fixed capital formation and net exports.
Observing the national expenditure, household consumption saw an increase of 0.7 percent, while general government spending bumped up by 0.5 percent. Conversely, gross fixed capital formation experienced a drop of 1.8 percent, and net exports' negative contribution to the GDP amounted to 0.5 percentage points.
When comparing year-over-year, the GDP for the December quarter decreased by 0.2 percent, a notable improvement compared to the 1.1 percent decline witnessed in the September quarter.
Parallel data indicates a monthly growth of 0.4 percent in retail sales in January, contrasting the stagnant growth in December. Sales of durable goods expanded by 1.3 percent during this month, while sales of consumables saw a downslide by 0.3 percent.
