Unexpectedly Strong Growth: Price Hikes Planned in Sweden

Sweden is experiencing unexpectedly robust economic growth, with fresh figures from Statistics Sweden (SCB) revealing a 1.6% GDP increase in the second quarter compared to the prior quarter. This performance significantly surpassed the 2.5% year-on-year growth predicted by analysts.

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Household sentiment strengthened in August and is now normal for the first time since November 2024.

The positive economic outlook is mirrored in consumer confidence. The National Institute of Economic Research (KI) reported that the barometer indicator rose to 105.1 in August, up from 104.6 in July. This improvement is largely attributed to a more optimistic sentiment within the service sector. Household confidence also climbed to 98.0, marking the first time since November 2024 that sentiment among households has returned to normal levels.

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A larger proportion of businesses than normal expect to be able to raise prices in the coming three months.

This strengthening economic climate appears to be paving the way for price increases. The KI report indicates that a larger-than-usual number of businesses expect to raise their prices within the next three months. This suggests companies are confident enough in consumer demand to pass on potential cost increases.

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GDP increased broadly in the second quarter with strong contributions from gross fixed investments, exports, and household consumption.

While overall economic activity is strong, the retail sector saw a slight dip, with sales volume decreasing by 0.2% in July compared to June. However, year-on-year figures paint a different picture. Retail sales volume in July increased by 6.2% compared to the same month in 2025. Sales of non-essential goods saw a notable 8.6% rise, while grocery sales (excluding Systembolaget) increased by 5.3%.

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Compared to the corresponding month in 2025, retail sales volume in July increased by 6.2 percent in calendar-adjusted figures.