Sweden Inflation


Sweden: Consumer prices again fall into negative territory, putting pressure on Central Bank to cut interest rate

May 12, 2015

In April, consumer prices were flat over the previous month. The reading was below the 0.1% increase recorded in March. The result undershot market expectations of a 0.3% increase. According to Statistics Sweden (SCB), March’s print mainly reflects that lower prices for package holidays and electricity were offset by higher prices for books, fuels, and clothing and footwear.

Consumer prices declined 0.2% in April over the same month of last year, which contrasted the 0.2% increase tallied in March. March’s print had marked the second consecutive price increase after six consecutive annual declines, allaying some of the concern that the economy was stuck in a deflationary spiral. However, with consumer prices turning negative again in April, the spotlight will fall on the Central Bank. The Bank cited improving inflation as a reason to keep its interest rate unchanged at its meeting in April, but will likely intervene with a rate cut soon to stoke inflation after this latest result. Annual average variation in consumer prices held at March’s minus 0.1%.

Meanwhile, annual core inflation—defined as the CPI with mortgage rates held constant—increased 0.7% in April, which was down from the 0.9% increase tallied in March.

The Central Bank expects inflation to average 0.3% in 2015 and sees it picking up to 2.0% in 2016. FocusEconomics Consensus Forecast panelists expect inflation to average 0.4% in 2015, which is up 0.1 percentage points from last month’s forecast. For 2016, the panel sees average inflation at 1.5%.

Author:, Economist

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Sweden Inflation Chart

Sweden Inflation April 2015

Note: Year-on-year and month-on-month variation of consumer price index in %.
Source: Statistics Sweden (SCB).

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