Breaking News
Get 40% Off 0
👀 Reveal Warren Buffett's stock picks that are beating the S&P 500 by +174.3% Get 40% Off

Swedish central bank seen hiking by half percentage point to 3.5% next week- Reuters Poll

Published Apr 21, 2023 10:46AM ET
Saved. See Saved Items.
This article has already been saved in your Saved Items
 
© Reuters. FILE PHOTO: The sign for Sweden's central bank is pictured in Stockholm, Sweden, August 12, 2016. Picture taken August 12, 2016. REUTERS/Violette Goarant/File Photo

STOCKHOLM (Reuters) - Sweden's central bank will hike its policy rate by a half a percentage point next week as it grapples with soaring inflation, with a further quarter point to come in June, a poll by Reuters showed on Friday.

Central banks around the globe have jacked up interest rates to tame levels of inflation not seen for at least 30 years and while tighter policy is beginning to bite and growth is slowing, their job is not yet considered done.

In Sweden, the pace of inflation slowed in March, but remains much too high and economists in the poll were almost unanimous in seeing a hike to 3.50% from the current 3.00% when the Riksbank announces its decision next Wednesday.

"Inflation is too high, the crown is weak and the economy is showing continued signs of strength," Swedbank said in a note. "We think inflation tips the scales in favour of 50 (basis point hike) rather than 25."

At its last meeting in February, the Riksbank tightened policy by 50 basis points and said it would hike by a further quarter or half percentage point at the April meeting.

Opinions about what the Riksbank will do after next week diverge.

The median forecast in the poll is for the policy rate to top out at 3.75% in the third quarter, but a higher or lower outcome is possible. Markets see the policy rate topping out close to 4.0%

The extreme pace of inflation - Riksbank Governor Erik Thedeen said recently it was "absurdly" far from the 2% target - argues for even tougher measures than current forecasts reflect.

The weak Swedish crown is also making the Riksbank's inflation-fighting job more difficult.

The European Central Bank is expected to hike by only a quarter percentage point on May 4. However, analysts expect the ECB's terminal rate to hit 3.75%, pressuring the Riksbank to at least match that level.

On the other hand, the economy is expected to slow sharply, while the rapid rise in interest rates over the last year has exposed problems in the global financial system.

Few expect another Lehman Brothers crash, but caution may be in order.

The median forecast in the poll showed the Riksbank starting cut rates at the start of next year.

Swedish central bank seen hiking by half percentage point to 3.5% next week- Reuters Poll
 

Related Articles

Add a Comment

Comment Guidelines

We encourage you to use comments to engage with other users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind:  

  •            Enrich the conversation, don’t trash it.

  •           Stay focused and on track. Only post material that’s relevant to the topic being discussed. 

  •           Be respectful. Even negative opinions can be framed positively and diplomatically. Avoid profanity, slander or personal attacks directed at an author or another user. Racism, sexism and other forms of discrimination will not be tolerated.

  • Use standard writing style. Include punctuation and upper and lower cases. Comments that are written in all caps and contain excessive use of symbols will be removed.
  • NOTE: Spam and/or promotional messages and comments containing links will be removed. Phone numbers, email addresses, links to personal or business websites, Skype/Telegram/WhatsApp etc. addresses (including links to groups) will also be removed; self-promotional material or business-related solicitations or PR (ie, contact me for signals/advice etc.), and/or any other comment that contains personal contact specifcs or advertising will be removed as well. In addition, any of the above-mentioned violations may result in suspension of your account.
  • Doxxing. We do not allow any sharing of private or personal contact or other information about any individual or organization. This will result in immediate suspension of the commentor and his or her account.
  • Don’t monopolize the conversation. We appreciate passion and conviction, but we also strongly believe in giving everyone a chance to air their point of view. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
  • Only English comments will be allowed.
  • Any comment you publish, together with your investing.com profile, will be public on investing.com and may be indexed and available through third party search engines, such as Google.

Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at Investing.com’s discretion.

Write your thoughts here
 
Are you sure you want to delete this chart?
 
Post
Post also to:
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Thanks for your comment. Please note that all comments are pending until approved by our moderators. It may therefore take some time before it appears on our website.
 
Are you sure you want to delete this chart?
 
Post
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Add Chart to Comment
Confirm Block

Are you sure you want to block %USER_NAME%?

By doing so, you and %USER_NAME% will not be able to see any of each other's Investing.com's posts.

%USER_NAME% was successfully added to your Block List

Since you’ve just unblocked this person, you must wait 48 hours before renewing the block.

Report this comment

I feel that this comment is:

Comment flagged

Thank You!

Your report has been sent to our moderators for review
Continue with Google
or
Sign up with Email