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Sweden lowers growth forecast



Stockholm: Sweden's government cut its growth forecast for a second time in two months, citing the turmoil abroad amid criticism it was seeking to play up crisis concerns to regain voter support ahead of next month's election.

Gross domestic product for the largest Nordic economy will expand 1.9 per cent in 2014, below a July forecast of 2.5 per cent, the Finance Ministry said in a statement distributed in Harpsund, south of Stockholm. Growth will be 3 per cent in 2015, versus the 3.1 per cent it forecast in July.

"The Swedish economy is expected to gradually recover but the recovery is still uncertain," finance minister Anders Borg said at a press briefing. "The risk picture is still negative."

Prime Minister Fredrik Reinfeldt's government, trailing in polls ahead of September 14 elections, is seeking to portray itself as a guarantor of job creation and economic strength. A DN/Ipsos poll out showed 43 per cent of Swedes had confidence in the premier leading in a "serious crisis" while 29 per cent said Social Democratic leader Stefan Loefven would be better.

Borg at a press conference earlier this week said that a large inflow of refugees from Syria and other global trouble spots will weigh on government finances. Sweden expects more than 80,000 asylum seekers this year, after a 70 per cent jump in the first six months. Refugees are entering at a pace not seen since the breakup of Yugoslavia in the early 1990s, according to the Migration Board in Stockholm.


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