Carl Nilsson, economist at Swedbank, says that it is too early to comment on whether the bank will revise its forecast regarding a first interest rate cut, but states:
– This outcome was reasonably in line with the Riksbank’s own forecast.
Handelsbanken writes in a comment that today’s announcement does not change anything and “we stand by the fact that the Riksbank will lower the interest rate in June”.
– This does not change the big picture for the Riksbank, says Susanne Spector, who still expects an interest rate cut in May.
The “basket effect”
However, Swedbank’s Carl Nilsson sees some problems.
– On the surface, there aren’t that many deviations and January is normally very volatile. Now there are certain technical factors that keep the rate of inflation down, it is the so-called “basket effect” when Statistics Sweden updates the basket of goods (which is the basis for the inflation measurement), he says.
Despite that, there are factors that suggest that the Riksbank will still have to act with interest rate cuts in the future. An increasingly weak economic environment in Sweden means that Swedish companies will find it increasingly difficult to raise prices at the same pace as they have been doing, Carl Nilsson assesses.
– We also have fairly low salary increases compared to, for example, the USA and the EU area and an exchange rate that actually turned down towards the end of the year. That should keep import costs down and cause Swedish inflation to continue to fall.
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Hear SVT’s economic commentator, Alexander Norén, about the new inflation figures. Photo: SVT
