20.06.201805:53:00UTC+00NIER Cuts Sweden's Growth Outlook

The Swedish economy will peak this year, the National Institute of Economic Research said in its Swedish Economy Report, released Wednesday.

The agency downgraded its 2018 growth outlook to 2.5 percent from 2.9 percent. GDP growth is forecast to slow next year to 1.9 percent partly due to falling domestic housing investment. The previous projection for 2019 was 2.1 percent.

The economic growth is seen at 2 percent in 2020 and 1.9 percent each in the following two years.

Exports are expected to strengthen next year, boosting industrial production. Investment will also grow relatively strongly this year, the Stockholm-based state-run think tank said. Meanwhile, housing investment is predicted to decline.

Inflation is forecast to stabilize around 2 percent in 2018 and 2019. The Riksbank will not, however, begin to raise the repo rate until the spring of 2019, the NIER said.

The jobless rate is forecast to fall to 6.2 percent this year and remain the same in 2019 and 2020.