Companies pursuing expansive agenda

SEB  has released its Fall 2017 CFO Survey in partnership with Deloitte this morning. The survey published twice a year,  aims to reflect changes in sentiment among Swedish CFOs, highlighting economic and financial trends. Respondents represent a selection of the 200 largest companies in Sweden across various industries.

The survey shows that Sweden’s CFOs feel increasingly optimistic about the immediate future. Concerns about negative effects from macro and political factors continue to subside, and on this point too, Swedish CFOs depart from their European counterparts, who still hold greater uncertainty. Please see below the top line points. A link to the survey report can be found here and a copy of the press release is included below.

Karl Steiner, economist at SEB Research, feels concerns are rising about the shortage of qualified labour: “Worries about a shortage of labour are rising in all sectors, which is alarming as this may result in production bottlenecks, which by extension could dampen growth. The CFOs’ strong expectations for higher interest rates and their strategy for dealing with this indicates a certain risk that the expansive agenda may be hampered somewhat in the coming year.

“What’s interesting is that Swedish CFOs are considerably more certain about higher interest rates than their European counterparts, and even more so than their counterparts in the other Nordic countries.”

Global outlook

  • Optimism is rising and there is greater willingness to invest – the CFO index shows an increase to 59.9 from a solid 58.2 in spring 2017, the highest level since February 2011
  • Swedish CFOs are seeing lower external uncertainty as well as expressing less concern about macroeconomic and political factors
  • Companies expect to see higher interest rates in the coming year – 56% of respondents within the euro zone expect interest rates to rise during the coming 12 months

Swedish outlook

  • Rising foreign demand and very expansionary fiscal and monetary policy continue to fuel strong growth in Sweden
  • Uncertain long-term outlook, which remains clouded by structural challenges in the labour and housing markets
  • Concerns about skilled labour shortages increased greatly and across sectors
  • 78% of Swedish CFOs expect interest rates to go up during the coming twelve months

Business outlook

  • Business conditions continued to improve – there is a shift towards more expansive priorities, where investments, geographic expansion as well as introduction of new products are gaining in popularity, while reducing costs is falling
  • Swedish CFOs remain far more optimistic than their euro zone peers as well as their Nordic peers except Finland
  • 100% of CFO respondents from the manufacturing sector view business conditions as favourable, while Consumer Business and Transportation (CB&T) is the least optimistic sector