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Reading The Swedish Markets

Published 02/28/2014, 08:22 AM
Updated 05/14/2017, 06:45 AM

Swedish Q4 GDP came in much higher than we anticipated and, as we suspected/feared, inventories were an important factor accounting for about half of the rise in GDP. However, in spite of that, we would say that the numbers were on the positive side, particularly with regard to residential construction which increased strongly.

In our view, the Riksbank minutes show that inflation is now in focus. Strong GDP data does not rule out a rate cut if inflation were to continue to fall behind the forecast and a strong real economic development is not a sufficient condition for future rate hikes -- actual inflation must also rise.

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