Sweden's manufacturing sector expanded at a softer pace in May, survey data from Swedbank and the logistics association SILF showed on Tuesday.
The purchasing managers' index for the manufacturing sector rose to 66.4 in May from a revised 69.0 in April.
A PMI reading above 50 suggests growth in the manufacturing sector.
"Despite the decline, it is the fourth highest level in the index's 26-year history and shows that the strong industrial economy persists even though increased supply shortages may become a greater challenge in the future," Swedbank analyst Jorgen Kennemar said.
All the five sub-indices declined in May. The largest negative contribution came from the order intake index.
The Swedish manufacturing PMI showed a growing optimism in the industry to increase production in the next six months, despite destruction in global trade and storage of intermediate goods, the survey said.
Prices for suppliers' raw material and input goods decreased in May, albeit at a historically high levels.
Cost pressures increased at the producer level due to higher activity in industry, rising global raw material prices and shortage in inputs.
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