Sweden's central bank holds rate but signals larger-than-expected future hikes; krona rises
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The Swedish krona rose on September 24 after the Riksbank, Sweden's central bank, held its key interest rate steady at 1.75% but signaled that future rate increases would be larger than previously anticipated. The central bank stated that if inflation and economic activity remain as projected, it expects to begin raising rates this year. It cited stronger economic activity and persistent supply shocks from the Middle East conflict as reasons for the hawkish shift. Although August inflation came in lower and matched the Riksbank's forecast, the bank warned that the risk of inflation exceeding its expectations has increased due to rising oil prices and a weaker krona.
Source report
The Swedish krona strengthened on Monday after the Riksbank kept its key interest rate unchanged at 1.75%, while indicating that future rate hikes would be larger than previously anticipated.
Key Highlights
- Rate decision: The Riksbank held the benchmark rate at 1.75%, in line with expectations.
- Forward guidance: The central bank stated that if inflation and economic activity remain on their current trajectory, it expects to begin raising interest rates this year.
- Economic backdrop: Stronger economic activity and ongoing supply disruptions linked to the Middle East conflict were cited as contributing factors.
Inflation Outlook
Although August inflation came in lower than expected and aligned with the Riksbank's own forecasts, the central bank warned that the risk of inflation exceeding previous projections has increased. It attributed this to rising oil prices and a weaker Swedish krona.
Source
金十数据Neutral / independent
Part of this Story
Riksbank holds rate at 1.75%, signals rate hike likely this year