The Swedbank Manufacturing PMI for December 2025 remains comfortably above the 50 expansion threshold, marking the 11th consecutive month of growth. The 54.60 reading, while down from November’s 55.10, still outpaces the 12-month average of 54.30, underscoring resilience in Sweden’s manufacturing base. This stability occurs amid moderate global growth concerns and tightening monetary conditions in Europe.

Drivers this month

• Strong domestic demand supported output, contributing approximately 0.25 points.
• Export orders softened slightly, subtracting -0.15 points amid global trade uncertainties.
• Input price inflation eased, reducing cost pressures by -0.10 points.

Policy pulse

The PMI reading aligns with the Riksbank’s inflation target zone, suggesting manufacturing activity is consistent with moderate price pressures. The central bank’s recent 25 basis point rate hike appears to be tempering overheating risks without stalling growth.

Market lens

Immediate reaction: SEK/USD strengthened 0.30% within the first hour post-release, reflecting confidence in Sweden’s growth outlook. Short-term yields on Swedish government bonds rose by 5 basis points, indicating modest inflation expectations.

Sweden’s manufacturing PMI is a leading indicator of industrial output and economic health. The 54.60 reading corresponds with recent GDP growth of 2.10% YoY and industrial production growth of 1.80% YoY as of Q3 2025. Inflation remains contained at 2.30% YoY, close to the Riksbank’s 2% target, supporting a balanced macro environment.

Monetary policy & financial conditions

The Riksbank’s policy rate currently stands at 3.75%, up from 3.50% last quarter. Financial conditions have tightened moderately, with credit spreads widening by 10 basis points over the past month. This tightening aims to curb inflation without derailing manufacturing expansion.

Fiscal policy & government budget

Sweden’s fiscal stance remains prudent, with a projected budget surplus of 0.50% of GDP in 2025. Government investment in green technologies and infrastructure continues to support manufacturing innovation and export competitiveness.

External shocks & geopolitical risks

Global supply chain disruptions have eased compared to early 2025, but risks persist from geopolitical tensions in Eastern Europe and China’s slower growth. These factors weigh on export orders and commodity prices, influencing manufacturing input costs.

Market lens

Immediate reaction: The SEK appreciated against the EUR and USD, while Swedish 2-year government bond yields rose by 5 basis points, reflecting investor confidence in sustained growth and controlled inflation.

Looking ahead, Sweden’s manufacturing PMI is poised to remain in expansion territory, supported by stable domestic demand and ongoing fiscal support. However, external risks and monetary tightening could moderate growth.

Bullish scenario (30% probability)

• Stronger global demand rebounds, boosting exports and pushing PMI above 56.
• Input costs stabilize further, improving margins and investment.
• Riksbank pauses rate hikes, supporting credit growth.

Base scenario (50% probability)

• Manufacturing PMI hovers around 54.50–55, reflecting steady but cautious expansion.
• Moderate inflation and monetary policy tightening balance growth.
• Export demand remains stable but subdued due to geopolitical uncertainties.

Bearish scenario (20% probability)

• Global slowdown intensifies, dragging PMI below 53.
• Rising input costs and supply chain disruptions pressure margins.
• Further monetary tightening dampens investment and hiring.

Sweden’s manufacturing sector continues to expand at a healthy pace, with the December PMI of 54.60 confirming resilience amid moderate headwinds. The balance of risks suggests a cautious but positive outlook, contingent on global trade dynamics and monetary policy calibration. Investors and policymakers should monitor export trends and inflation signals closely to navigate the evolving landscape.

Key Markets Likely to React to Swedbank Manufacturing PMI

The Swedbank Manufacturing PMI influences several key markets, notably those tied to Sweden’s economic health and export performance. The SEK currency pair SEKUSD is sensitive to PMI shifts, as stronger manufacturing data typically supports SEK appreciation. The OMX Stockholm 30 index (OMXS30) often tracks PMI trends, reflecting investor sentiment on industrial earnings. In fixed income, Swedish government bonds (SE10YT) react to PMI-driven inflation expectations. Additionally, EURSEK forex pairs respond to relative growth signals between Sweden and the Eurozone. Finally, the cryptocurrency pair BTCUSD can exhibit risk-on or risk-off moves aligned with macroeconomic sentiment shifts triggered by PMI releases.

Indicator vs. OMXS30 Since 2020

FAQ

What is the Swedbank Manufacturing PMI?

The Swedbank Manufacturing PMI measures the monthly performance of Sweden’s manufacturing sector, indicating expansion or contraction.

How does the PMI affect Sweden’s economy?

The PMI signals industrial growth trends, influencing GDP forecasts, monetary policy, and financial markets.

Why is the PMI important for investors?

Investors use the PMI to gauge economic momentum and adjust portfolios based on expected growth or slowdown.

Key takeaway: Sweden’s manufacturing sector remains robust, with the December PMI supporting a cautiously optimistic economic outlook amid global uncertainties.

This has been drafted with AI assistance and then thoroughly reviewed, refined, and approved by our human editorial team to ensure accuracy, and originality.