Sweden: Election uncertainty and fiscal stance – Nomura
Nomura’s Global Markets Research team, led by Josie Anderson, George Buckley and Andrzej Szczepaniak, notes that Sweden’s 13 September election remains too close to call, with the centre-left only narrowly ahead.
In Sweden, the 13th September election remains uncertain with the centre-left narrowly ahead in preliminary vote counts. A clear winner is expected by 16th September when late advance votes are tallied. However, final certification could take up to a week. Coalition negotiations could last several weeks. Sweden's government debt is low at 35% of GDP, giving it a strong fiscal position.
The Riksbank's monetary policy will likely be unaffected as it faces stronger global energy price dynamics. A centre-left government may increase spending on healthcare and education and raise taxes, including a potential bank levy on net interest income. Gold fell below $4,300 on Monday due to increased demand for the US Dollar ahead of the Fed's decision, while Bitcoin and Ethereum showed neutral-to-bullish trends.
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