Swedish industrial production suffered its sharpest fall since 2009 in February, jarring a reassuringly rosy outlook painted by other recent economic indicators and calling into question expectations the central bank will not take rates any lower.
The Nordic country, sheltered by robust public finances, has so far weathered the downturn spawned by the euro zone debt crisis and recent gauges of economic activity had pointed to a moderate recovery. Although the statistics office said there were indications the fall in production was temporary, the output numbers raised doubts how well Sweden's export-dependent economy can perform if large swathes of the European economy, its biggest export market, slip into recession.
Industrial production fell a much worse-than-expected 5.2 percent in February and tumbled 7.1 percent year-on-year, statistics office SCB said, the sharpest fall since the aftermath of the global financial crisis, in November 2009. "This was much weaker data than we had expected. Even if we were at the low end looking at consensus, we really didn't expect it to come in this low," SEB analyst Sanna Eckardt said. Analysts polled by Reuters had expected a 0.2 percent gain on the month for a year-on-year increase of 1.1 percent. Industry order bookings were no better, plunging 5.5 percent on the month and 8.3 percent on the year.
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