(Bloomberg) -- Confidence levels jumped in Sweden as consumers and businesses started to leave the worst of the Covid-19 crisis behind them.
The overall economic tendency survey rose to 75.2 in June, from a revised 64.4 in May, the National Institute of Economic Research said Wednesday. Sentiment had plunged to an all-time low in April, and despite June's jump remains depressed, as values below 90 are equivalent to a much weaker than normal economy.
“All in all, sentiment is recovering from the initial shock, but is still gloomy and perhaps somewhat more pessimistic than expected,” Nordea economist Torbjorn Isaksson said. “The export industry continues to struggle. A good sign is households' relatively optimistic view on their own financial situation.”
The reading comes as economists and policy makers revise up their forecasts in light of better-than-expected consumer spending and unemployment data.
According to Manuel Oliveri, an FX strategist at Credit Agricole, the rebound in confidence levels “continues to keep the risk for additional policy action low, irrespective of Riksbank members leaving all options open.”
But Bloomberg economist Johanna Jeansson was less sanguine, while agreeing that “the most acute phase of the crisis has abated.”
“Today's survey is yet another sign that the most acute phase of the crisis has abated. But with both demand and supply below pre-pandemic levels, we expect the Riksbank and the Ministry of Finance will have to do more,” Johanna Jeansson
Unlike its neighbors, Sweden avoided a strict lockdown as the coronavirus spread, keeping shops, schools and restaurants open. The lax strategy appears to have mitigated some of the economic damage caused by the pandemic, but at the cost of a relatively high death toll.
Read more: Sweden Raises Forecast for Economy as Recovery Starts to Pick Up
The Numbers
- The consumer confidence index rose to 84.0, from a revised 77.7
- The manufacturing confidence index rose to 89.1, from a revised 76.4
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