Business News
Swedish central bank governor: Bleak economic prospects for 2009
Dec 31, 2008, 7:57 GMT
Stockholm - The outlook for the Swedish economy in 2009 is bleak, although predictions are difficult to make, Swedish central bank governor Stefan Ingves said Wednesday.
The Swedish central bank's assessment is that the 'the global financial crisis will continue to impact the Swedish economy despite sizeable countermeasures,' Ingves said in an op-ed piece in the Dagens Nyheter daily.
The Swedish gross domestic product was expected to fall in 2009.
However, there was reason to be optimistic in the longer term, Ingves said, citing 'that the measures conducted by central banks and governments around the world will soften the economic effects of the financial crisis.'
Developments in neighbouring Baltic countries posed a 'specific uncertainty factor for Swedish financial markets,' Ingves said.
'Swedish banks have a lot of business and extensive loans there. Our assessment is that the banks are strong enough to tackle increased loan losses,' he said.
In mid-December, the central banks of Denmark and Sweden signed a swap agreement with the central bank of Latvia guaranteeing short-term loans of up to 500 million euros (675 million dollars).
The Swedish Riksbank said its share was 375 million euros.
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