Perspectives on monetary policy Cecilia Skingsley Deputy Governor - PowerPoint PPT Presentation

Perspectives on monetary policy Cecilia Skingsley Deputy Governor Riksdag Committee on Finance 7 March 2019

My presentation today • I support the assessments and the monetary policy decision in February • We have a long period of very expansionary monetary policy behind us • According to our forecasts, we have entered a slow normalisation process • Appropriate time to provide some perspective on monetary policy and its effects • Distributional effects a topical issue

Low and stable inflation helps to avoid arbitrary redistribution 14 14 CPIF 1981-1992 Mean value Mean 7.6 10 10 1995-2019 (January) 6 6 Mean: 1.7 2 2 -2 -2 80 85 90 95 00 05 10 15 Note. Annual percentage change. Inflation outcomes for the period before 2005 are calculated in accordance with the method used in real time during this period. Source: Statistics Sweden and the Riksbank

The expansionary monetary policy of recent years has been aimed at achieving the inflation target, but has also had distributional effects … while more people in work has contributed to income Rising asset prices have benefited certain groups ... equalisation 16 000 300 Other assets Insurance, pension and standardised guarantee schemes 14 000 Tenant ownership rights 250 Shares and funds 12 000 Currency and deposits 200 OMX (right scale) 10 000 HOX (right scale) 8 000 150 6 000 100 4 000 50 2 000 0 0 Note. Thousands, index (Q1 2005 = 100) and per cent of the Source: Statistics Sweden, Valueguard and the Riksbank population, aged 15-74, seasonally adjusted data.

Difficult monetary policy situation 2014-2015 Inflation Inflation expectations Note. Annual percentage change. Inflation expectations refer to Sources: Statistics Sweden and Kantar Sifo Prospera averages among money market participants.

Difficult monetary policy situation 2014-2015 Inflation Inflation expectations Note. Annual percentage change. Inflation expectations refer to Sources: Statistics Sweden and Kantar Sifo Prospera averages among money market participants.