Monetary policy decision July 2018
Expansionary monetary policy for continued on-target inflation going forward
Favourable international economic activity, moderate inflation GDP growth Inflation Oil price providing a boost Annual percentage change. The KIX is an aggregate of GDP in countries Sources: Bureau of Economic Analysis, Eurostat, that are important for Sweden's international transactions. national sources and the Riksbank
Greater uncertainty abroad Increased trade barriers Economic policy situation in Italy Unease in some emerging market economies
Strong economic activity in Sweden Growth subdued in line with expectations Continued strong labour market Annual percentage change and net figures respectively. Recruitment plans Source: National Institute of Economic Research, Statistics Sweden and refer to expectations of the number of employed in the business sector three the Riksbank months ahead. Broken line in the figure to the right is the average for 2000– 2017.
Inflationary pressure rising, but slowly 5 5 CPIF 4 4 3 3 2 2 1 1 0 0 -1 -1 01 04 07 10 13 16 Annual percentage change. The field shows the highest and lowest Sources: Statistics Sweden and the Riksbank outcome for different measures of underlying inflation, see note. Fig 3:3 in MPR. The dot represents the latest outcome for the CPIF.
Weaker krona Weaker krona Stronger krona Index, 18 November 1992 = 100. Outcomes are daily data and forecasts Sources: National sources and the Riksbank refer to quarterly averages. The KIX is an aggregate of exchange rates in countries important for Sweden's international transactions.
Inflation on target with support from monetary policy Energy prices and exchange rate Annual percentage change. Sources: Statistics Sweden and the Riksbank
Monetary policy considerations Developments largely in line with the forecast. Inflation on target , energy prices providing a boost As before, inflationary pressure deemed moderate Greater uncertainty abroad Argument for continuing down chosen path and waiting until the end of the year to raise the interest rate
Continued expansionary monetary policy Interest rate expected to be increased towards end of year Reinvestments in bond portfolio 80 80 Reinvestments of coupons 70 Reinvestments of redemptions 70 New purchases 60 60 50 50 40 40 30 30 20 20 10 10 0 0 H1 H2 H1 H2 H1 H2 H1 H2 H1 2015 2015 2016 2016 2017 2017 2018 2018 2019 Per cent and nominal amount, SEK billion. The development of Source: Sveriges Riksbank reinvestments from mid-2018 onwards is a forecast and refers to nominal amounts. The final amounts will depend on current market prices.
Expansionary monetary policy for continued on-target inflation going forward
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