OECD Economic Outlook 69 - Biblioteca Hegoa

130 - OECD Economic Outlook 69
… while monetary conditions
remain supportive of growth
GDP is projected to expand
slightly above potential rates
Sweden: Demand, output and prices
1997 1998 1999 2000 2001 2002
current prices
billion SKr
Percentage changes, volume (1995 prices)
Private consumption 922.0 2.7 3.8 4.1 2.5 2.9
Government consumption 484.0 3.2 1.7 -1.7 1.0 2.0
Gross fixed capital formation 276.8 8.5 8.1 4.5 6.1 6.4
Final domestic demand 1 682.9 3.8 4.0 2.6 2.8 3.3
a
Stockbuilding 7.6 0.4 -0.5 0.6 -0.2 -0.1
Total domestic demand 1 690.5 4.3 3.4 3.2 2.5 3.3
Exports of goods and services 778.2 8.4 5.9 9.8 6.5 7.3
Imports of goods and services 644.9 11.2 4.3 9.7 6.3 8.3
a
Net exports 133.3 -0.3 1.1 0.9 0.7 0.2
GDP at market prices 1 823.8 3.6 4.1 3.6 2.8 3.0
GDP deflator
Memorandum items
_ 0.9 0.5 0.8 1.1 2.2
Private consumption deflator _ 1.0 0.8 0.9 1.6 2.2
Unemployment rate b
_ 6.5 5.6 4.7 4.1 3.9
c
Household saving ratio _ 2.4 2.0 2.0 4.0 4.2
d,e
General government financial balance _ 1.7 1.8 4.1 3.6 3.4
d
Current account balance _ 2.9 3.5 2.5 2.1 1.8
Note: National accounts are based on chain-linked data. This introduces a discrepancy in the identity between real
demand components and the GDP. See "Sources and Methods" for further details.
a) Contributions to changes in real GDP (percentage of real GDP in previous year), actual amount in the first column.
b) Based on monthly Labour Force Surveys.
c) As a percentage of disposable income.
d) As a percentage of GDP.
e) Maastricht definition.
Source: OECD.
in 2001, with further income tax cuts amounting to some 1¼ per cent of GDP, and
the Spring Budget implies some further easing in 2002, even without additional tax
cuts, which remain high on the agenda. Nevertheless, cyclically-adjusted net lending
is projected to show a robust surplus of around 3 per cent of GDP both this year and
next, and gross public debt should continue to decline rapidly. While the Spring
Budget projects that total expenditures will remain just below their ceiling, the
absence of a contingency margin implies that any unexpected pick-up in spending
must be fully offset by discretionary savings.
The monetary policy stance remains relatively easy. The Riksbank raised the
repo rate by ¼ percentage point in December 2000, but at 4 per cent, the rate is still
well below that of the euro area. The nominal effective exchange rate has weakened
since the middle of 2000, and it recently reached its lowest level in five years. Thus,
monetary conditions are supportive of robust growth. With inflation projected to
edge up, policy-controlled interest rates should not be lowered from the current level.
Real GDP is projected to expand by 2¾ per cent in 2001 and by 3 per cent
in 2002. This is slightly higher than estimated potential growth, which could reach
2¾ per cent per year if labour-market programmes are scaled back to make room for
continued robust employment growth. The latter is projected to increase by an average
of more than 1 per cent annually so that unemployment could fall to around
3½ per cent by late 2002. Inflation is projected to increase from less than 1 per cent
in 2000 to around 2¼ per cent in 2002.