Sweden’s CPI inflation reading for April was a negative 0.2% – down from +0.2% in March – while underlying inflation fell from 0.9% to 0.7%. Cheaper holidays, lower interest rates and falling electricity prices contributed to the downturn.
The Riksbank has low tolerance of negative surprises and it is feasible the central bank will cut its benchmark rate further in the coming weeks, particularly if the Swedish krona strengthens against the euro.
In a Confederation of Swedish Enterprise survey, 93 per cent of Swedish listed companies have said they have been victims of piracy, or lost patent revenues as a result of counterfeiting. In addition, 80 per cent believe counterfeiting and piracy will rise in the coming years.
China has long been the leading producer of pirated goods, but the industry is growing in countries such as Russia, Nigeria and Turkey, reports business paper Dagens Industri.
Piracy is a matter for the government, and the EU, says Patrick Krassén, IPR manager at the Confederation. “It’s about putting political pressure on these countries in international negotiations. Additionally, the issue needs to be put on the political agenda in Sweden,” he remarks.
Sweden’s nuclear industry is under pressure as a result of falling electricity prices coupled with rapidly rising energy taxes, waste fees and new security requirements.
Vattenfall is already seeking the early shutdown of two of four reactors at the Ringhals nuclear power plant, and now plans are being drawn up to close two of the three reactors at Oskarshamn, according to energy market consultant Christian Holtz.
The deciding factor could be new independent core cooling requirements which will demand billions of kronor in investment, says Holtz.
The widespread criticism of the December Agreement and the inflation target could lead to political chaos, warns Anders Ferbe, chair of the Metalworkers’ union (IF Metall) in Dagens Industri this morning. While commending the interest shown by business leaders for the political situation, they need to do their homework writes Ferbe and points out that the December deal has served to create the minimum of trust required to govern the country and ensure stability ahead of the autumn’s wage negotiations.
The National Audit Office has started a preliminary study into the Riksbank and monetary policy, with the aim of launching an inquiry, which will be concluded by the end of the year.
“We want to examine how the Riksbank has fulfilled its price stability target, and whether the target is compatible with today’s situation. We also want to see whether the Riksbank has the right tools,” says Claes Norgren, who was deputy governor of the Riksbank in the early 1990s.
It is the first time the Audit Office has wanted to examine Sweden’s monetary policy, and means more pressure on the Riksbank.
Automotive workshop chain Mekonomen is expanding to South Korea with sales of proprietary spare parts range ProMeister. Sales will occur through collaboration with South Korean distributor EK (Eiko) Global, and will include cooperation on facilities with a ProMeister profile and training via ProMeister Academy.
“This is a milestone for Mekonomen, since our products and brands are now on the map of the large Asian market..,” writes Håkan Lundstedt, CEO.
The company already has a presence in the Nordic countries.
The German division of Sweden’s state-owned Vattenfall has taken further steps to push for a mining permit for the open pit at Nochten II, sources have told SvD.
However, Mikael Petrovic-Wågmark Vattenfall’s head of Nordic press affairs, tells SvD that no investment decisions have been taken and no mining permits have been granted that will enable the company to expand its lignite operations.
Equity analyst Peter Malmqvist has described the Riksbank’s policy as “alarming”. He does not believe in negative interest rates as a means of bringing up inflation to target; all it does is to build bubbles in the economy.
“I am against the policy that has been pursued in the past few years. Property prices are rising, there are no homes, and the stock market is going up. All curves in Sweden are pointing upwards right now, apart from the interest rate,” he says, and suggests that the consequences could be grave when inflation starts picking up and the bubbles burst.
Vattenfall announced yesterday that it was seeking to shut down reactors 1 and 2 at its Ringhals nuclear power plant between 2018 and 2020, rather than in 2025 as was previously planned.
Energy prices are falling and Vattenfall CEO Magnus Hall has said he does not see any indication that they will increase in the coming years. At the same time, the utility is facing increasing production costs, and intends to trim 1,000 staff. The cuts will affect staff in Sweden, Germany and the Netherlands, according to the CEO.
Magnus Hall has also said that the decision had been made on a commercial basis and that no political pressure had been exerted. However, he admitted that reactors which ran smoothly would probably not have to close, were it not for the new and higher tax on nuclear power.
The decision to shut down the reactors must be taken by the Ringhals board and presupposes that co-owner E.On will agree to the plans.
Jonas Abrahamsson, E.On manager for the Nordic region, said yesterday that it must first analyse the proposal.
The book value of Ringhals 1 and 2 is around SKr 15 billion. Were the two reactors to shut down, Vattenfall and E.On will be forced to make extensive write-downs.
“We are looking at the financial impact and aim to submit a report on this in conjunction with the Q2 report,” Magnus Hall told the press.
The planned divestment of Vattenfall’s German lignite business was one of the key issues on the agenda at the state-owned utility’s AGM on Monday. Left leader Jonas Sjöstedt wondered what environmental requirements were being made of potential buyers, to which CEO Magnus Hall replied: “Our view is that the environmental requirements for brown coal are a matter for the German government, not for Vattenfall”.
Hall denied rumours in the international press that the company is facing delays in the planned sale of its lignite business, following concerns over a proposed coal emissions levy.
“The process is most definitely not on hold. Our hope is that by the end of the year something will be on the table that the government can consider,” he said.