Feb. 23 (Bloomberg) -- Swedish consumer confidence unexpectedly dropped this month amid rising unemployment and slowing growth in the largest Nordic economy.
The consumer confidence index fell to minus 3.2 in February from minus 1.3 the prior month, the Stockholm-based National Institute of Economic Research said today. Economists predicted a reading of zero, according to the median of 11 forecasts in a Bloomberg survey. A manufacturing confidence index was at minus 13, compared with minus 14 last month.
“Today’s weak reading suggests that consumers’ propensity to spend has remained low at the start of the year,” said Andreas Jonsson, an economist at Nordea Bank AB, in a note. “Moreover, the weak private consumption during the second half of last year marks a weak starting point for this year and we should therefore only expect a very modest private consumption growth in 2012.”
The Riksbank this month cut its key rate for a second time in as many meetings in an effort to avert a recession. Sweden’s economy, which relies on exports for about half its output, will slow to 0.7 percent this year from 4.5 percent in 2011, the central bank said on Feb. 16.
Inflation expectations over the next 12 months eased to 2.3 percent in February from 2.7 percent the previous month, the institute said. The Riksbank targets 2 percent inflation.
Swedish unemployment rose more than estimated last month, a report showed yesterday. The non-seasonally adjusted unemployment rate, based on a survey of about 29,500 people, rose to 8 percent from 7.1 percent in December, Stockholm-based Statistics Sweden said yesterday.
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