Check the speedo sender connector in the differential. Volvo put a "safety" wire to keep the connection together. Almost 20 years later, that wire can cut through the insulation of the wires and bodge up the signal.
Other possible culprits are the instrument cluster PCB, or the speed itself. Our 1991's speedo conks out every once and a while, and the problem is likely the instrument cluster PCB.
-Ryan
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Athens, Ohio 1987 245 DL 314k, Dog-mobile 1990 245 DL 134k M47, E-codes, GT Sway Bars 1991 745 GL 299k, Regina, 23/21mm Turbo Sway Bars Buckeye Volvo Club
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