Sweden: 2024 Article IV Consultation-Press Release; and Staff Report
IMF Staff Country Reports, March 11, 2024
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- Sweden: 2024 Article IV Consultation-Press Release; and Staff Report
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Bibliographic details
- Published: March 11, 2024
- Series: IMF Staff Country Reports
- DOI: https://doi.org/10.5089/9798400270185.002
Macroeconomic performance and outlook
- Gross domestic product is estimated to have declined by 0.3 percent in 2023.
- The slowdown in 2023 was driven by declining private consumption and residential investment, amid a significant tightening of financial conditions and eroding real incomes.
- Activity is expected to remain subdued during 2024 and pick up gradually thereafter.
Labor market and wages
- The labor market is showing signs of cooling.
- Employment growth has moderated.
- Wage growth has been modest.
Financial conditions, credit, and asset prices
- Private credit is declining.
- Real estate and equity prices have fallen from their 2022 peaks.
- Corporate bankruptcies have picked up sharply.
Corporate sector and commercial real estate
- The commercial real estate sector is severely hit.
- Highly leveraged and lowered-rated firms are seeing their debt-carrying capacity indicators deteriorate significantly.
Banking system resilience
- The banking system remains resilient with strong profitability and sizeable capital and liquidity buffers.
Policy recommendations and structural priorities
- Structural reforms will be instrumental to strengthen medium-term growth and support social inclusion and the green transition.
- Efforts focused on upskilling and education opportunities and strengthening working incentives are welcome.
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- 1sweea2024001