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UPDATE 1-Swedish April consumer confidence tumbles

Published 04/29/2009, 04:14 AM
Updated 04/29/2009, 04:16 AM
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* Swedish consumer confidence tumbles

* Firms forecast continued large staff cuts

* Households pessimistic about economy

(Adds quotes, details)

STOCKHOLM, April 29 (Reuters) - Swedish consumer confidence tumbled in April as more households remained downbeat about personal finances and possible unemployment, the National Institute of Economic Research said on Wednesday.

Consumer confidence fell to -21.0 points in April from -16.5 the previous month, and compared with the median forecast of -15.0 seen in a Reuters poll of analysts.

"Households are still very pessimistic about the economic situation ... Confidence in both personal finances and the Swedish economy is gloomy," the institute said in a statement.

Export-oriented Sweden is facing its worst financial crisis in decades, and companies across the country are shedding thousands of jobs due to the global economic downturn.

"It is mainly worries about the labour market that are coming through loud and clear," said Knut Hallberg, analyst at Handelsbanken.

"This (survey) shows that the Swedish economy continues to weaken and that the labour market issue will be a wet blanket for quite some time."

The government expects unemployment, currently at 8 percent, to climb to just under 12 percent in 2011.

World number two truck maker Volvo is in the process of cutting more than 20,000 jobs across the group while Sweden's SCA, Europe's biggest manufacturer of corrugated packaging and hygiene products, announced plans on Wednesday to slash 2,200 jobs in Europe, or some 14 percent of its workforce.

Sweden's quarterly seasonally adjusted manufacturing business confidence indicator was -35 points, down from -34 points in January, when the previous quarterly survey was published.

"We were looking for a bottoming out in sentiment in the business sector, but the level is still very low and we are very far from a recovery," said Olle Holmgren, analyst at SEB.

The outlook was little better in Denmark, where manufacturing industry confidence for the near term also deteriorated slightly in April. [nLT600146]

Sweden's NIER said inflation expectations had fallen in the month with households now seeing the inflation rate at 1.7 percent in 12 months. In the March survey, inflation was seen at 2.0 percent. (Reporting by Mia Shanley and Sven Nordenstam, editing by Mike Peacock)

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