Sweden Boosts Growth Forecasts, But Warns Of Major Risks

(RTTNews) - The Swedish government raised its economic growth forecasts on Friday, but warned that the outlook faces significant risks.

Gross domestic product was forecast to grow 2.8 percent this year, which was faster than the 2.6 percent predicted in June. The growth projection for next year was raised to 2.8 percent from 2.7 percent.

Growth was forecast to ease to 2.6 percent in 2017, while it was earlier seen at 2.4 percent. Projection for 2018 was lifted to 2.4 percent from 2.3 percent and the outlook for 2019 was held unchanged at 2 percent.

"Stronger growth throughout the world is boosting the economic situation in Sweden," the Ministry of Finance said in a statement.

"However, there is a substantial risk of growth being weaker than expected. Apart from the risk of stagnation in the euro area, there are major concerns about the emerging economies, and more and more indicators are pointing to a more dramatic slowdown in China than in previous forecasts," the ministry added.

Further, slowdown in Norway and Finland could also impact the Swedish economy outlook adversely, the ministry said.

The government also raised the forecast for public finances and the deficit is now expected to shrink more quickly and net lending is expected to reach balance in 2019.

"The Government's priorities ahead of the Budget Bill for 2016 are clear. In our Sweden, more people will have a job, attainment in schools will be turned around and climate emissions will be reduced," Finance Minister Magdalena Andersson said.