Sweden: Inflation slows to a 20-month low in April
May 10, 2012
In April, consumer prices rose 0.2% over the previous month, which was slightly below the 0.3% increase tallied in March. According to Statistics Sweden (SCB), the reading was mainly driven by price increases for clothing and shoes, international flights and higher rents. Despite the monthly price increase, annual headline inflation edged down from 1.5% in March to 1.3% in April, which was below market expectations of 1.4%. At the current level, annual inflation is below the Central Bank's (Riksbank) inflation target of 2.0% and, in fact, represents the lowest level of inflation seen since August 2010. Annual average inflation also moderated and inched down from 2.7% in March to 2.6% in April. Meanwhile, the core inflation index, defined as the CPI with mortgage rates held constant, increased 0.3% over the previous month, driving annual core inflation to 1.0% in April, which was down from March's 1.1%. Riksbank expects inflation to moderate going forward and to average 1.2% in 2012 and 1.9% in 2013.