Nordic outlook – Normalising economies, with risks
|Highlights
We expect growth rates, inflation, interest rates and labour market indicators to arrive at more normal levels over the coming year, after the wild swings over the last four.
Inflation has come down or is heading that way, shifting focus towards the real economy and the risk that there could be too much slowdown.
Like the rest of Europe, the Nordic countries are mostly heading for higher growth and lower interest rates, but with a lot of variation between them.
Global
We expect slightly higher growth in Europe including the Nordic countries, with important variations between countries, and slightly lower growth in the US. It seems that manufacturing is less of a growth driver than we expected, though, partly related to continued weakness in China. Inflation has declined markedly in the US, and that clears the road for gradual and cautious interest rate cuts. Our forecasts are broadly similar to our last Nordic Outlook, but the balance of risk has shifted somewhat away from the risk of persistent high inflation and towards the risk of a more pronounced economic slowdown.
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