The central bank of Sweden announced Thursday that it was raising its key rate by 0.25 points to 4%, the highest in 15 years, due to excessively high inflation and that it could raise this rate further.
Inflationary pressures in the Swedish economy are still too high, said the central bank in a press release, adding that the key rate could be raised further.
Sweden suffers from high inflation, which peaked at 12.3% year-on-year in December, but which has gradually slowed since then while remaining at a high level (+7.5% in August).
The Nordic country must face the weakness of the crown against the euro and the dollar, which increases the price of its imports. The crown thus hit a low of 12 crowns per euro on Monday.
Prices of services continue to rise rapidly, which, combined with the unjustified weakness of the crown, helps keep inflation high and increases the risk that inflation will not continue to fall and stabilize around the target sufficiently. quickly, writes the Riksbank.
This rate increase was expected by economists due to inflation.
The central bank expects inflation of 4.6% next year, and 2.5% excluding the impact of real estate loans, still far from its inflation target of 2%.
It forecasts a contraction in economic activity this year (-0.8%) and a virtual stabilization of GDP next year (-0.1%).
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