Sweden August Retail Sales Rebound as Government Plans Tax Cuts

Sweden’s retail sales rose last month as consumers drive a recovery in the largest Nordic economy after the government promised tax cuts and the central bank pledged low interest into late next year.

Sales rose a monthly 0.3 percent after falling 0.7 percent the previous month, Stockholm-based Statistics Sweden said today. The median estimate in a survey of six economists by Bloomberg was for sales to grow 0.4 percent. Annual retail sales rose 2.4 percent.

“An improving labor market and promises of a new round of tax cuts in the 2014 budget continue to suggest an acceleration in private consumption in Sweden,” said Elisabet Kopelman, an analyst at SEB AB in Stockholm, in a note before the report.

The government this month said it will support the recovery by cutting income taxes for a fifth time since coming to power in 2006. Sweden’s central bank predicted it will keep rates unchanged at the lowest level since 2010 for another year to support a recovery as demand from abroad picks up.

The euro-area emerged from a record-long recession last quarter, expanding for the first time since 2011. Sweden sells about half its output abroad, of which about 70 percent goes to Europe.

To contact the reporter on this story: Johan Carlstrom in Stockholm at jcarlstrom@bloomberg.net

To contact the editor responsible for this story: Jonas Bergman at jbergman@bloomberg.net

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