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Andreas Wallström, Analyst at Nordea Markets, notes that Sweden’s unemployment increased to 6.3% in April, which is in line with the Riksbank’s forecast but way above the government’s target.

Key Quotes

The outcome is, however, fully in line with the Riksbank’s forecast at 6.3% on average for Q2.”

“Employment  stayed unchanged over the month, while we had expected a modest increase. Labour supply rose in line with expectations.”

“All in all, the report was healthy although not super strong. The continued low unemployment rate (likely below the natural rate) may give the  Riksbank faith  in higher wage growth. So far, however, wage growth has been modest and we don’t foresee any noticeable increase going forward.”

“The  government’s goal  of reaching the lowest unemployment rate in the EU remains  distant.”