STOCKHOLM - Sweden’s finance minister said on Saturday the government would cut its economic growth forecasts for the country towards the end of the year against a backdrop of weak European and US economies.

“We will present a new GDP forecast a little before Christmas,” Anders Borg told journalists, adding that he was referring to a downwards revision. The once resilient Nordic economy is increasingly feeling the impact of the economic weakness of its trading partners, after avoiding much of it initially, helped by strong public finances. The centre-right government’s current forecasts, from its 2013 budget in September, are for 1.6pc growth in the export-dependent country this year and 2.7pc in 2013. Borg said the global economy was in a difficult situation and it was difficult to predict the length of the downturn but said he had no plans for any short-term stimulus measures.

“It is hard to compensate for the fact Swedish companies are seeing a drop in demand,” he said on the sidelines of a conference of the Moderates Party, the biggest party in the centre-right government.

The government in September rolled out an expansionary budget for 2013 and held out the prospect of further stimulus if spillover from the economic downturn in the euro zone got worse. Unemployment in Sweden is predicted to rise as a wave of redundancies are expected to kick in. Economists widely expect the economy to flatline or even contract in the second half of 2012. In the second quarter, the economy expanded 0.7 per cent from the previous quarter, making an annual growth rate of 1.3 per cent.