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Monetary policy decision February 2020 Low interest rate for a - - PowerPoint PPT Presentation
Monetary policy decision February 2020 Low interest rate for a - - PowerPoint PPT Presentation
Monetary policy decision February 2020 Low interest rate for a long time to ensure close-to-target inflation Global demand has slowed down in recent years Calmer GDP growth But strong labour market 14 14 Unemployment, United States 12 12
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2 4 6 8 10 12 14 2 4 6 8 10 12 14 02 05 08 11 14 17 20
Unemployment, United States Unemployment, Euro area
Global demand has slowed down in recent years
Calmer GDP growth But strong labour market
Annual percentage change, seasonally adjusted data and share of labour force. Sources: Eurostat and the OECD
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Lower interest rates in wake of increased economic unease
Sources: National central banks, US Treasury and the Riksbank Yields on 10-year government bonds
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Global economy on slightly firmer ground
- Confidence in the manufacturing industry has stabilised
- Some of the uncertainty weighing on developments has declined
- Trade agreement between the USA and China
- The UK has left the EU
- But difficult to estimate the consequences of the new coronavirus
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Signs of stabilisation in the Swedish economy too
Sources: National Institute of Economic Research and Swedbank/Silf
Index, average = 100, standard deviation = 10, seasonally adjusted
- figures. The purchasing managers' index is a diffusion index in which
values above 50 indicate growth.
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Balanced economic situation in Sweden
- Moderate growth since middle of 2018
- Signs that growth will rise from end of 2020
- Stabilisation abroad
- Housing construction increasing
- Household consumption rising
Sources: Statistics Sweden and the Riksbank Annual percentage change
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Employment increasing but at slower pace
Percentage of population, 15-74 years, seasonally adjusted data. Sources: Statistics Sweden and the Riksbank
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Inflation close to target in recent years
Annual percentage change Source: Statistics Sweden
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Inflation subdued this year as last year by low energy prices
Annual percentage change Sources: Statistics Sweden and the Riksbank
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- 1
1 2 3
- 1
1 2 3 11 13 15 17 19 21 23
Expansionary monetary policy for inflation to be close to target
Per cent Source: The Riksbank
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- 4
- 2
2 4 6
- 4
- 2
2 4 6 96 00 04 08 12 16 20 United Kingdom United States Sweden
Low interest rates over a long time
- Interest rates have fallen in recent decades
- Ageing population contributes to increased saving
- Lower productivity growth and investment
- Led to historically low policy rates
- Expectation that interest rates will be low for a
long time
- The Riksbank has adjusted monetary policy to
support the economy and inflation
Sources: National central banks and the Riksbank Real government bond yields, 10-year maturity
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