Swedish government to run smaller deficit amid lower pandemic spending

Sweden’s government will run a budget deficit of 256 billion crowns ($29.34 billion) this year, the Debt Office said on Wednesday, smaller than previously expected as the costs of measures to fight the pandemic have proven lower than initially feared.

“The virus outbreak has had a major impact on the Swedish economy and state finances, but the development in recent months indicates it is less than we forecast in May,” Hans Lindblad, Director General of the Debt Office, said in a statement.

The Debt Office forecast the deficit would be 80 billion next year.

In its previous forecast, the Debt Office expected a deficit of 402 billion crowns this year and 76 billion in 2021.

($1 = 8.7239 Swedish crowns)