Sweden’s GDP growth rises. It writes the OECD in the spring forecast. – Swedish Dagbladet

Private consumption and investment continued to grow healthy while foreign trade provide a significant but moderate contributions, helped by a weaker krona and increased activity among our major trading partners, says the Economic Outlook, which was presented on Wednesday.

Unemployment is expected to decline only slowly because it takes time to integrate the considerable flow of immigrants and increased labor force participation. Inflation is expected to pick up gradually as wages rise and the disinflationary impact of falling oil prices fades.

Monetary and fiscal policy is very expansive and needs to remain so until inflation is clearly moving the goal, according to the organization, noting that macro-prudential supervision should be strengthened and supplemented with measures that increase the supply of housing to enhance financial stability.

The OECD notes that the Riksbank lowered the repo rate gradually, launched a program of quantitative easing and they stated that they will do more if needed to prevent inflation expectations drop anchor and strengthening of the krona.

“Expansionary monetary policy and the slowing effect of the fall in oil prices is expected to raise inflation. Yet is not expected inflation target of 2 per cent is reached until after 2016, despite an expected further easing of monetary policy, “writes the OECD.

Fiscal policy is something expansive, but will move to a neutral stance in As the available resources decrease. The OECD notes that the Government is considering abandoning the target of a surplus of 1 percent of GDP over a business cycle in favor of a balanced budget, and think it would be appropriate given the strong position of government finances.

Structural policies need to focus on improving the integration, education and innovation to boost growth in the long term, according to the OECD.

“To improve skills among young people and integrating immigrants, who mostly have low education, are essential to reduce unemployment and securing inclusive growth, “writes the OECD.

The organization notes that housing investment is increasing rapidly from a low level, in response to a strong demand in the housing market. Residential investment should also continue to increase, but at a slower pace when the constraints on the supply side is becoming a restraining factor.

Investment growth in business is robust, with software and R & D accounts for a large share of business investment, and public investment rising at a moderate pace, with a focus on improved infrastructure for trains and roads.

The OECD expects that Sweden’s GDP will grow 2.8 percent in 2015 and 3.0 percent in 2016. In the autumn forecast saw OECD GDP to grow by 2.8 percent in 2015 and 3.1 percent in 2016.

The OECD also notes that household indebtedness and house prices have continued to rise, increasing the need for macro-prudential measures and the phasing out of interest deductions. The supply of housing could increase with decreased regulations and incentives for municipalities to free up land.

As Sweden is a small open economy will unexpected growth outcomes among our main trading partners, particularly the EU, and currency movements will have a big impact on production.

“Because interest rates are sure to be low for some time yet as, a failure to tackle the rise in household debt through macro prudential measures and structural reforms could result in unbalanced growth, which would enhance financial and macroeconomic risks “, writes the OECD.