Sweden's economy will face a recession next year caused by rampant inflation and the war in Ukraine, the country's new Finance Minister Elisabeth Svantesson said, Reuters reported.

The economy is currently expected to contract by 0.4 percent in 2023, she said, and there is a significant risk that the result could be even weaker.

The Scandinavian country's previous government in August projected growth of 0.4 percent in 2023.

"Sweden's economic outlook is gloomy and we're heading for a tough winter," Svantesson said at a news conference, adding that there is a high risk that things could get even worse.

The Finance Ministry also raised its inflation forecast, predicting fixed-rate consumer price growth of 7.9% this year and 5.2% next year, up from the previous government's August forecast of 7.3% and 3.9%, respectively.

Svantesson promised to stick to Sweden's fiscal policy framework, which manages public finances with a surplus of 0.3 percent of GDP over an economic cycle.

"For us and me, it is important that fiscal policy in this situation is well balanced, that fiscal policy does not fuel inflation," she said.