Recent months have seen a strong international recovery, and Nordea revises up its expectations to the 2011 growth outlook.

The global economy came out of 2010 in even better shape than we expected, and we are revising our growth forecast for 2011 which nonetheless looks set to be an interesting year. The upswing is challenged by the announced budget consolidation measures in most European countries and the surge in commodity prices. As a result, we see 2011 as a transition year with global growth abating relative to 2010 before showing renewed strength in 2012, says Helge J. Pedersen, Nordea's Global Chief Economist.

The Nordic economies

The economies in the Nordic region have now shifted into a higher gear, led by the Swedish tiger economy, which has delivered impressive growth rates over the past year. But all the Nordic countries are in a relatively favourable situation thanks to their generally healthy public finances.

After the deep recession in 2009 the Swedish economy recovered sharply in 2010. The export industry benefited from the improvement in global trade, but export growth is expected to dampen from previous strong records. Households' financial position is in good shape, boosting private consumption.

After the massive setback in 2009, economic growth returned soundly to positive territory in Denmark in 2010. The contours of a broadly based upswing have emerged with five consecutive quarters of positive growth. On the threshold to the election year of 2011 consumers and businesses have stepped up a gear, and the course is set for a continued rebound in the Danish economy.

Thanks to a strong finish last year, growth in Norway in 2010 will be somewhat stronger than originally expected. Stronger momentum into 2011, somewhat better labour market conditions and prospects of very robust growth in oil investment have also led us to revise up our 2011 growth outlook.

The economic outlook in Finland is positive. Rapid expansion of important trading partners' economies suggests that demand for Finnish exports will remain strong, especially as demand is expected to shift more towards investment goods.