Sweden GDP Rebounds: Key Factors Behind Q1 Growth

Forex News—In the first quarter of 2024, Sweden’s economy grew by 0.7% quarter-on-quarter. This performance defied initial expectations of a 0.1% contraction and market predictions of stagnation. This is the most substantial quarterly growth since Q2 of 2022.

Sweden GDP Rebounds: Key Factors Behind Q1 Growth

The growth was mainly driven by a rise in fixed investment, particularly in machinery, equipment, and weapons. Fixed investment increased by 0.6%, a significant improvement from a 1.5% decline in the previous quarter. Additionally, net trade positively impacted GDP, with exports growing for the third consecutive quarter by 0.2%, while imports remained flat.

Changes in Inventories and Government Spending

Inventory changes, especially in trade inventories, also contributed to the GDP growth. However, government spending showed a moderate increase of 0.2%, slightly down from 0.4% in the previous quarter. Household spending decreased by 0.3%, marking the first decline in a year.

Yearly Growth Reaches New High

On an annual basis, Sweden’s GDP grew by 0.7% in Q1 2024, reversing a 0.1% decline in Q4 2023. This is the highest yearly growth rate in four quarters, highlighting a significant rebound in the Swedish economy.