Sweden: Inflation falls to lowest level in more than three years
March 12, 2013
In February, consumer prices rose 0.4% over the previous month, which contrasted the 0.8% decline recorded in January. According to Statistics Sweden (SCB), the reading was mainly influenced by price increases for clothing.
Despite the monthly increase, annual consumer prices fell 0.2% in February (January: 0.0%), which was in line with market expectations and represented the lowest reading since November 2009. At the current level, inflation is well below the Central Bank's (Riksbank) target of 2.0%. Annual average inflation inched down from 0.7% in January to 0.6% in February.
Meanwhile, the core inflation index - defined as the CPI with mortgage rates held constant - rose 0.5% over the previous month in February, whereas annual core inflation inched down to 0.9% (January: +1.0%).
According to its February Monetary Policy Report, the Riksbank expects inflation to average 0.4% this year and 2.1% in 2014 (previously forecasted: 0.3% and 2.3% respectively). FocusEconomics Consensus Forecast panellists expect inflation to average 0.6% in 2013, which is down 0.1 percentage points from last month's forecast. For 2014, the panel sees average inflation at 1.8%.