Swedish Finance Minister Anders Borg says his government will make a new GDP forecast before Christmas, following the wave of job cuts to hit the country since the Autumn budget.
Speaking at a conservative Moderate party "future" conference, Borg said they will probably have to lower their predictions for economic growth, but added that it won't affect government economic policies.
He told journalists that "now is not the time for short-term economic stimulus", news agency TT reports, "We can't compensate for the fact that companies are facing less demand from the global economy", Borg added.
The government's current forecasts are for 1.6 percent growth this year and 2.7 percent in 2013.
Borg also announced he is willing to look at reversing a government policy that has meant that contributions to unemployment benefit schemes have wildly differed between the different schemes.
In Sweden unemployment benefit is administered by individual schemes, often linked to trade unions, and employees pay a monthly fee to be a member. The fee then funds the scheme, and the more unemployed there are in that trade, the higher the fee. Government regulation used to limit differences between the schemes, but that was removed by the current government, often making scheme membership more expensive, and meaning hundreds of thousands chose to leave. That then meant that they had little financial support if they became unemployed.
But now Borg says he is willing to reintroduce the regulation, if unions and employers can develop reforms in the labour market to make it easier for young people to enter the workforce.
The opposition Social Democrats and trades unions have long criticised the government's decision to remove the government regulation of the unemployment benefit schemes, and they say they welcome Anders Borg's comments.
Karl-Petter Thorwaldsson, head of the blue collar Trades Union Congress LO, told news agency TT:
"I'm naturally very pleased and proud that we have come so far in our discussions about the new job pact. For us this is better than a Kinder egg."
Social Democrat economic spokesperson Magdalena Andersson says:
"This has been an important and central part of government policy., which has been a total failure. It's good that Anders Borg is backing down."