Although its Nordic neighbors may be suffering strong economic headwinds, Sweden’s economy is booming, supported by solid domestic demand and a surprising surge in exports. Domestic demand was buoyed by strong investment, particularly in the vibrant housing market. Sweden’s external sector has benefited not just from a relatively weak krona, but also from favorable external demand for service exports, which make up a substantial amount of Sweden’s export profile. The country is also getting a boost from increased expenditure related to the recent influx of migrants. Statistics Sweden expects that the wave of migrants that entered Sweden last year contributed to a 0.5–1.0 percentage-point increase to GDP growth in Q4.
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