The Swedish economy has been resilient to such uncertainty, it noted, “but sentiment in the household and corporate sectors can deteriorate rapidly.”
Whether such factors are enough to sway Sweden’s position on the euro remains to be seen, Gerlach said, pointing to deep-seated distrust of how the single currency is managed, and to fears of being drawn into future sovereign bailouts.
“Politicians will weigh the risks of having an external crisis against risks of having another eurozone crisis,” said the Swedish economist, who also served as deputy governor at Ireland’s central bank.
Public opinion has remained cautious. A Eurobarometer poll found last year that only 39 percent of Swedes believed the country was ready to adopt the euro. That’s up 7 percentage points from a decade earlier, however, and it could rise further if tensions on the international stage threaten the krona.
Bulgaria’s recent admission into the euroclub leaves Czechia, Hungary, Poland, Romania and Sweden as the last remaining holdouts. Their entry is legally required once they meet and maintain specific economic criteria over a specific period of time. Avoiding those thresholds altogether has been a strategy that countries such as Poland have adopted to keep euro banknotes out of their citizens’ wallets.
“Our economy is doing clearly better than most of those that have the euro,” Poland’s finance minister, Andrzej Domański, told the Financial Times, citing solid growth, low unemployment and rising wages. That argument doesn’t necessarily apply to Sweden, whose economy is much smaller and more vulnerable to global uncertainty.
