Swedish Riksbank Ends Negative Policy Rate Stance

December 19, 2019

The Executive Board of the Swedish Riksbank raised the repo rate to zero¬† percent from -0.25%. Sweden’s central bank had been the first to experiment with a negative policy interest rate. Last January, such had been raised 25 basis points to -0.25%. A released statement from policymakers said policy remains expansionary. The repo rate is not expected to be lifted into positive territory until 2022, and asset purchases will continue until the end of 2020. Officials anticipate inflation hovering near the 2% target and foresee a gradual acceleration of economic growth from 1.1% this year to 1.9% in 2022. Should the economy deviate from these expectations, officials are prepared to change the course monetary policy.

Copyright 2019, Larry Greenberg. All rights reserved. No secondary distribution without express permission.



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