Nordic Outlook: Time to get inflation down

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2023 will be shaped by efforts to bring down inflation, and if all goes well, a mild recession should be enough to rebalance the economy. However, it is a difficult task for central banks to achieve, and there is a risk of a deep recession or inflation to become more ingrained, writes Danske Bank’s macroeconomists in a new Nordic Outlook analysis.

Strong Nordic starting point

Heading into a recession, the Nordic countries have a strong starting point. Compared to most other European countries, the Nordic countries have been less damaged during the Covid crisis, and have recovered more quickly. Government finances are generally in good shape, and measures to help households and businesses cope with inflation are comparatively modest.

 

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