Sweden Lowers Growth Forecasts

(RTTNews) - The Swedish Finance Ministry on Tuesday lowered the growth forecasts for this year and next, citing weaker growth abroad and the sustained deficits in public finances.

The growth forecast for this year was cut to 2.4 percent from 3 percent predicted in the Budget Bill presented in October last year. The projection for 2016 was reduced to 2.7 percent from 3.2 percent.

The economy is seen expanding 2.6 percent in 2017, unchanged from the previous forecast. Meanwhile, the prediction for 2018 was raised slightly to 2.5 percent from 2.4 percent.

For 2014, growth was estimated at 1.8 percent, which was weaker than the October forecast of 2.1 percent.

"The slow recovery around the world is holding back growth in the Swedish economy," Finance Minister Magdalena Andersson said.

"Given the public finance deficits, there is no scope for extravagances, but at the same time we have to nurture the recovery."

The country's unemployment rate is seen easing only slightly to 7.7 percent this year from 7.9 percent in 2014. The figure is expected to drop further to 7.4 percent next year.

The latest projection showed no budget surplus for the four years in the forecast horizon until 2018, when public finances are seen reaching a balance.