Sweden: Riksbank stays put in February
February 13, 2013
At its 13 February monetary policy meeting, the Central Bank (Riksbank) left the repo rate unchanged at 1.00%, in a move that was in line with market analysts' expectations. According to the Bank, "the repo rate needs to remain low to support the economy and to ensure inflation rises to the target of 2 per cent". In the previous meeting held in December, the Bank had cut the repo rate by 25 basis points.
Riksbank pointed out that developments in emerging economies are positive and the economic recovery in the United States continues. At a domestic level, the Bank stated that the Swedish economy is still fragile but added that "there are some positive signs pointing towards stabilisation and strengthening in economic activity over the year".
Regarding price developments, Riksbank acknowledged that inflationary pressures remain subdued due to weak economic activity. Indeed, the Bank expects inflation to remain below its target of 2.0% this year. Riksbank left its forecast for the average repo rate unchanged at 1.00% in 2013 and 1.50% in 2014.