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UPDATE 1-Swedish consumer view turns gloomier as economy slows
September 26, 2012 / 8:26 AM / 5 years ago

UPDATE 1-Swedish consumer view turns gloomier as economy slows

* Consumer confidence at 2.0 pts vs forecast 5.2

* August trade surplus lowest since Dec 2011 (Adds details, quotes)

STOCKHOLM, Sept 26 (Reuters) - Swedish consumer confidence is at its lowest level since March and manufacturing businesses have turned slightly gloomier, data showed on Wednesday, confirming the slowdown in the Nordic state.

Separate data also showed the lowest trade surplus since December last year as the key export sector further suffers from a drop in demand from neighbours struggling with the euro zone crisis.

"All in all it gives a picture of a slowdown in the Swedish economy in the fall," said Swedbank analyst Knut Hallberg of the confidence data.

"This puts additional pressure on the Riksbank and brings the question of a further rate cut into focus, but the figures are not decisive."

The central bank cut its key repo rate by 25 basis points in early September to 1.25 percent due to worries about an economic slowdown. It has said it will hold the rate until late 2013 before raising it again, but many investors expect at least one further rate reduction.

Consumer confidence slid to 2.0 points in September from 5.4 points in the previous month, the lowest since March 2012's reading of zero, the National Institute of Economic Research said in a statement. Analysts polled by Reuters had expected consumer sentiment to fall marginally to 5.2 points.

"The level of the indicator is therefore three points under the historical average and signals households are slightly more pessimistic than normal about the economic situation," NIER said.

The drop in the index was due to the fact that consumers had become more pessimistic about their own finances and about the economy as a whole, it said.

The seasonally adjusted manufacturing business confidence indicator slipped to -10 points from -9 points in August.

The overall economic barometer fell just over one point to 95.8 from 96.9 points.

Sweden's trade surplus slipped to 3.3 billion crowns ($505 million) from 3.7 billion crowns in August, the lowest since the 2.5 billion surplus of December last year. (Reporting by Patrick Lannin; Editing by Toby Chopra)

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