Sweden: 2023 Article IV Consultation-Press Release; Staff Report; and Statement by the Executive Director for Sweden
IMF Staff Country Reports, March 16, 2023
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- Sweden: 2023 Article IV Consultation-Press Release; Staff Report; and Statement by the Executive Director for Sweden
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Bibliographic details
- Published: March 16, 2023
- Series: IMF Staff Country Reports
- DOI: https://doi.org/10.5089/9798400237478.002
Overview
- Sweden experienced a strong post-pandemic rebound in 2021–22 but is potentially heading into a recession.
- The fiscal stance is slightly contractionary in 2023, which is appropriately supportive of monetary policy.
- The rapid and decisive monetary policy response targeted at reigning in record high inflation is well justified.
- Concrete progress in structural reforms is needed to address long-standing shortcomings and to fulfill Sweden’s ambitious climate agenda.
Macroeconomic outlook and inflation
- Strong recovery continued well into 2022 following the pandemic.
- Risk of entering a recession is highlighted.
- Record high inflation is being actively targeted by rapid and decisive monetary tightening.
Fiscal policy and policy stance
- Fiscal stance described as slightly contractionary in 2023.
- Recommendations on fiscal management:
- Regularly review the fiscal stance in line with growth and inflation developments.
- Allow automatic stabilizers to fully operate.
- If needed, adjust discretional expenditures.
Monetary policy
- Recent tightening and readiness to tighten further is welcomed given the priority to reduce inflation.
- Monetary policy tightening is portrayed as appropriately supportive of the inflation objective.
Structural reforms and long-term priorities
- Areas identified for reform:
- Labor market
- Housing market
- Educational gaps
- Employment of the foreign-born
- Bankruptcy framework
- Fulfilling Sweden’s ambitious climate agenda will require substantial effort and funding.
Subjects and keywords highlighted in the report
- Subjects: Economic and financial statistics, Financial institutions, Fiscal policy, Fiscal stance, Government finance statistics, Housing prices, Inflation, International organization, Monetary policy, Mortgages, Prices.
- Keywords include: Baltics, CPIF inflation, Europe, Fiscal stance, Global, Government finance statistics, HICP inflation, Housing prices, Inflation, inflation development, liability positions vis-à-vis nonresident, money market rate, Mortgages.
International Monetary Fund. Sweden: 2023 Article IV Consultation-Press Release; Staff Report; and Statement by the Executive Director for Sweden
Content in this bundle
- 1sweea2023001