SWEDEN: Signs Of Labour Market Improvements In October PES Data
The Swedish labour market is showing signs of improvement, according to Public Employment Service data for October. This shouldn’t impact the Riksbank outlook – it’s rather confirming that the current policy stance is supporting the economic recovery. The policy rate is expected to remain at 1.75% for “some time”. However, we continue to think that the risk of a hike back to 2% is greater than the risk of another cut over a 12-month horizon.
- The unemployment claims rate fell a tenth to 6.8%, the lowest since July 2024. Meanwhile, vacancies ticked up slightly relative to September (89k vs 87k prior), allowing the vacancies to unemployment claims ratio to rise to 0.25, a nine-month high.
- That said, the aggregate number of vacancies is still down 7% Y/Y (vs -6% Y/Y prior).
- Although the number of redundancy notices rose a little in October, the 3mma still fell for the third consecutive month to 4.5k (vs 4.8k prior).
- In yesterday’s November meeting minutes, First Deputy Governor Bunge said that “If confidence among households is to continue rising and the recovery is to begin in earnest, I think it is important that the labour market also develops in line with our expectations”… “There, the signals are rather more mixed, with indicators pointing in different directions. I think it is understandable that companies have taken a cautious stance with regard to recruitment after a long period of weak economic activity.”
- October LFS data is due on November 14.
Want to read more?
Find more articles and bullets on these widgets:
Historical bullets
GERMAN AUCTION PREVIEW: On offer tomorrow
Germany has announced a 2.00% coupon for the new Dec-27 Schatz which will be on auction tomorrow. Germany is planning to auction E5.5bln of the line.
UK FISCAL: Weekend roundup of Budget press stories
- Bridget Phillipson, the Education Secretary who is running for Labour Deputy Leader, said on Sky News in an interview over the weekend that she was "confident that we as a Government will do the right thing by children growing up in poverty in our country." She followed by saying that "There's an urgency to this. With every year that passes more children are moving to poverty because of the two-child limit." Note that this policy is expected to cost more than GBP3bln and is not included in most estimates of the fiscal shortfall of around GBP30bln that Chancellor Reeves is expected to be needing to raise in the 26 November Budget.
- There were also a number of reports that Reeves is looking to increase fiscal headroom above the c. GBP10bln seen in the last two fiscal events. The Guardian is reporting a Treasury source stating "We would like more headroom. We want to try to insulate ourselves better against the volatility in the bond markets." More headroom is something that the MNI Markets team has been advocating for some time. If headroom is not sufficient then even small economic disappointments can lead to concerns that taxes will need to increase further down the line which creates uncertainty for both consumers and businesses (potentially delaying investment).
- There are reports that the Treasury is considering responding to farmers' concerns through a proposal put forward by CenTax over the inheritance tax reforms. At present the reforms are due to kick in at 20% after the first GBP1mln (half the normal 40%) but the report notes that thresholds of between GBP1.5-5.0mln may be considered with the standard 40% tax rate applicable after that. This would undoubtedly be a popular policy in rural communities.
- There are lots of opinion pieces on how stamp duty and council tax could be reformed (with the former particularly in focus after Badenoch stated that the Conservatives would abolish it). But at present it is unclear whether any reforms to either of these taxes are seriously under consideration.
- Furthermore, see our bullet earlier on the IFS options for the budget (7:45BST).
SILVER TECHS: Impulsive Bull Wave Extends
- RES 4: $52.689 - 4.500 proj of the Sep 4 - 16 - 17 price swing
- RES 3: $52.386 - 4.382 proj of the Sep 4 - 16 - 17 price swing
- RES 2: $52.000 - Round number resistance
- RES 1: $51.692 - Intraday high
- PRICE: $51.649 @ 08:23 BST Oct 13
- SUP 1: $46.722 - 20-day EMA
- SUP 2: $42.938 - 50-day EMA
- SUP 3: $41.135 - Low Sep 17
- SUP 4: $40.404 - Low Sep 4
Trend signals in Silver remain bullish. The metal has traded to a fresh cycle high today. Recent gains have resulted in a move above a major resistance area around the $49.00-$50.00 region. This marks a high point from Jan ‘80 and Apr ‘11 and $50.00 represents a key psychological level. A clear break of this zone strengthens a bull theme and paves the way for a climb towards $52.00 next. Support to watch lies at $46.204, the 20-day EMA.
