Swedish Services Industry Shrinks for Third Month on OrdersJohan Carlstrom
Sweden’s services output contracted for a third month in May as an order declined accelerated, adding to signs the largest Nordic economy is struggling to recover.
An index based on responses from about 200 purchasing managers in the services sector fell to a seasonally adjusted 47.7 in May from 48.6 the previous month, Stockholm-based Swedbank, which compiles the index, said today. A reading below 50 signals a contraction. The median estimate of five economists surveyed by Bloomberg was a reading of 49.3.
“All in all a weak number that indicates that Sweden is still struggling to find traction in the domestic economy,” said Mikael Sarwe, chief analyst at Nordea Bank AB, in Stockholm, in a note to clients.
Swedish growth is being held back by the debt crisis in Europe, which is eroding demand for exports. Sales abroad account for about half of the Nordic country’s $500 billion output.
The business volumes sub-index rose to 50.9 from 49.5, the order index decreased to 47.2 from 49.2 and the employment index fell to 43.9 from 46.8.