The Swedish government has warned of more difficult economic times due to high inflation and the war in Ukraine. Economic growth expectations for Scandinavia’s largest economy were lowered on Wednesday.

 

Swedish Finance Minister Mikael Damberg lowered the forecast for this year to a growth of 1.9 percent, compared to 3.1 percent in April. The growth forecast for next year was also revised downwards.

The war in Ukraine has caused fuel and food prices to rise sharply, fueling inflation and putting pressure on purchasing power.

Damberg said there are many uncertainties surrounding economic developments and therefore prudent fiscal policy should be pursued. It is especially important that poor households are supported against the high inflation, according to the minister.