Talking Points:
- Industrial Production and Orders increase m/m, yet remain down on the year
- Service Production behaves in the opposite manner
- USDSEK challenges resistance post NFP
While finishing the year strong, industrial production and orders struggled to recover to pre-crisis levels; the first index falling 1.6% in volume, when measured year-over-year, and the later falling 11.4% percent. The exception to this pattern: service production, which decreased in the final month of 2014, but increased 3.7% on the year. The weakened productivity can largely be explained by Sweden’s broader labor market comprised of fewer manufacturing jobs.
Month-over-month, from November to December, industrial production increased 1.7%, yet total production for the year remained negative with volume down 1.9%. Cumulatively while all subsectors were fairly weak, it was the electrical equipment industry that showed the least activity, declining 6.5%. Year-over-year the greatest impediment to growth was the motor vehicle industry which fell by 17.3% while the industry for coke and refined petroleum products aided expansion, increasing 42.9%.
The report for industrial orders is similar, with the index increasing 5.1% month-over-month while cumulatively decreasing 3.3% for the year. From November to December the strongest development came from the transport and other equipment industry (+62.4%) while the greatest decline came from the industry for fabricated metal products (-10.8%). Through the entirety of 2014 domestic market orders were down by 5.8% while orders in the export market only fell by 1.6%.
As the contrarian indicator, service production increased by 3.7% year-over-year despite decreasing month-over-month in December by 0.2 percentage points. Notable time framed discrepancies: the art, entertainment, and recreation industry which decreased by 3.5% (m/m) yet increased by the same proportion year-over-year; the motor vehicle industry decreased 3.3% (m/m) yet increased 4.3% (y/y).
USDSEK Daily Chart
Chart Created by Walker England Using MarketScope2.0
