Sweden’s services industry unexpectedly contracted in March, casting doubt on the strength of the recovery in the largest Nordic economy.
An index based on responses from about 200 purchasing managers in the services industry fell to a seasonally adjusted 47.3 from 54.6 the previous month, Stockholm-based Swedbank AB, which compiles the index, said today. A reading below 50 signals a contraction. The index was seen at 54.2 in a Bloomberg survey.
Sweden’s economic growth will pick up this year, the government and central bank estimate, as a slump in exports and job losses abate. After four interest rate cuts since December 2011, Sweden’s central bank in February kept its benchmark interest rate unchanged amid optimism Europe’s debt crisis would abate. The bank signaled then it was finished with easing policy.
The business volumes sub-index fell to 47.9 from 56.9, the order index decreased to 46.4 from 57.2 and the employment index fell to 46.2 from 52.3.