The downturn has bottomed out in Europe, and the US economy is set for a sharper rebound. We see the main risks coming from emerging economies, Swedbank said in an economic outlook.

The Swedish economy benefits from recovering trading partners and from election-related spending. However, significant imbalances and structural challenges remain.

Steady growth expected in the Baltic economies in the coming two years. Latvia will adopt the euro in 2014, while Lithuania stays on track to adopt it in 2015.