Swedish Economy Sees Optimistic Growth Driven by Households in 2025

Recent forecasts from SBAB indicate a brighter economic outlook for Sweden in 2025, with households playing a central role in the growth trajectory. According to SBAB’s chief economist Robert Boije, Sweden’s GDP is now projected to increase by 1.2% this year, up from an earlier estimate of 1.0%, and a further robust growth of 2.6% is expected in 2026. The role of households as primary growth drivers this year is underscored by strong financial activity in both saving and borrowing patterns.

Data reveals that Swedish households have significantly boosted their savings in liquid assets, amassing 76 billion kronor by the end of the recent quarter. Simultaneously, borrowing has also increased, with household loans climbing by 41 billion kronor, bringing the total loan volume to 5,418 billion kronor. This corresponds to an annual growth rate of 2.5% in household borrowing, reflecting a dynamic balance of accumulating savings alongside rising debt.

Unemployment is forecast to peak at 8.7% during 2025 before easing slightly to 8.4% in 2026. Inflation, measured by KPIF, is expected to moderate to 1.4% by 2026, helped by the halving of VAT on food, before rebounding modestly to 1.9% in 2027. The housing market is also projected to remain strong, with prices anticipated to rise 4-5% annually over 2026 and 2027, driven in part by a slight increase in housing starts to around 29,000 units.

These trends show a household sector that is actively contributing to economic resilience through increased consumption, saving, and borrowing activities. SBAB’s updated forecasts paint a picture of a steady recovery supported by household financial behavior and anticipated boosts in public consumption next year.