Sweden's unemployment rate dropped to 7.4 percent in August from 8.0 percent the previous month, Statistics Sweden said Thursday, just days before general elections focused on the economy and jobs.

• Sweden's welfare untouched by rightwing parties

Some 370,000 people were out of work last month, the agency said, explaining "the number of unemployed persons and the unemployment rate have in recent months showed a downward trend, which continued this month."

The unemployment rate had dropped significantly in July, to 8.0 percent from 9.5 percent in June.

The decrease in unemployment in August was larger than expected, according to economists polled by Dow Jones Newswires, who expected a rate of 7.8 percent.

Seasonally ajusted figures show unemployment was at 8.2 percent in August against 8.5 percent in July.

Year-on-year, the number of unemployed people fell by 23,000 people, the statistics agency said.

Sweden's centre-right government, which hopes to be re-elected Sunday, said in August the country's economy had recovered quickly from the global financial crisis.

It lowered its unemployment forecast to 8.5 percent for all of 2010 and to 8.0 percent for next year, from a previous estimate that unemployment would reach 8.9 percent this year and 8.4 percent in 2011.

Polls have hinted at a tight race between Prime Minister Fredrik Reinfeldt's ruling alliance and the leftwing opposition coalition, but most recent surveys have handed the government the lead, largely helped by its handling of the economic crisis.

The leftwing opposition has criticised the government for failing to come through on unemployment, pointing out it had come to power in 2006 vowing to lower the then around six-percent jobless rate.