Riskbank cuts Sweden’s repo rates 06 September 2012Sweden Reporter: Jenna Jones
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Riskbank’s executive board has decided to cut Sweden’s repo rate, to prevent inflation falling too low. The rate will be cut by 0.25 percentage points, to 1.25 percent.
The reduced rate is expected to stay at this level until the middle of 2013, in the hopes of supporting economic activity, and contributing to the inflation rising toward a 2 percent target.
Growth in the Swedish economy this year has been stronger than predicted, with the summer seeing the krona appreciate faster than anticipated.
These factors indicate that inflationary pressures are now expected to be lower than forecast in July.
Economic growth slowed in June this year as activity in construction and private sector services fell dramatically. However, Swedish consumer confidence rose unexpectedly in July, with the indicator increasing to 5.6 from a level of 3.1.
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