Erik Thedéen: Weak consumption and the housing market - causes and lessons learnt
Speech by Mr Erik Thedéen, Governor of the Sveriges Riksbank, at the Stockholm Chamber of Commerce, Stockholm, 16 January 2026.
The views expressed in this speech are those of the speaker and not the view of the BIS.
Slides accompanying the speech
The Riksbank's most recent forecast, like several other forecasts, points to good growth and low inflation this year and in the coming years. Following a period of weak demand, growth in Sweden started to pick up last year, helped by strong exports and rising private consumption. CPIF inflation, which had previously been elevated, had fallen to 2.1 per cent in December.
Despite high uncertainty, not least in the rest of the world, Sweden's economy is thus, by all accounts, currently in a relatively favourable position. It may therefore be appropriate to reflect now on the consequences of the macroeconomic shocks we have experienced in recent years, and the lessons we can learn for the future.
Today I will focus on household purchasing power and consumption, and their links to the housing market. Disposable income and consumption fell after inflation picked up in 2022 and remained weak for a couple of years thereafter, both compared with historical trends and with the euro area and the United States. Weak consumption, together with low residential investment, contributed to the weak GDP growth in 2023 and 2024.