April 14, 2021
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Sweden: careering around the target

  • CPIF inflation rose to 1.9% in March, very close to the RB’s target, while the CPI rate was bang in line with the consensus and ourselves, at 1.7%.
  • We still expect inflation to accelerate to the peak in April before driving back to a near-1% trough in July. Our 2021 call is broadly a consensus one but is above the local view.

March 15, 2021
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Sweden: eating disinflation in Feb-21

  • The inflation rate according to the CPIF (CPI with fixed interest rate) was 1.5% y-o-y in February 2021, down from 1.7% in January. CPI inflation was 1.4%, some way below the consensus of 1.6%, although the outcome was only 0.1pps shy of our forecast.
  • The Riksbank expects that it will be 2023 before CPIF inflation returns to the 2 per cent target on a more sustainable basis. We also see an imminent rise above 2% as fleeting.

February 19, 2021
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Riksbank: relaxed about excess inflation

  • The minutes of the latest Riksbank Monetary Policy Meeting showed strong support for unchanged policy settings.
  • Despite Sweden’s better than expected economic performance since the November meeting, there was a dovish tone to the debate, with several members showing a willingness to cut the repo rate if needed.
  • Even in a scenario where the economy recovered more quickly than expected, it was felt that an inflation overshoot could help to anchor expectations more firmly around the target.