at the same time informs the Riksbanken that it will continue with verdipapirkjøpene in the second half of the year, as announced in april. The total purchases will then be 245 billion Swedish krona.
Immediately after the interest rate decision weakened svenskekronen against the Norwegian crown, but then turned it again.
The Swedish central bank reports that the upturn in the Swedish economy is continuing, but that it will take longer than previously thought to bring the Swedish rate of inflation up to the target of two per cent.
New forecast: Lower interest rates ahead
to provide support to the inflasjonsoppgangen plan Riksbanken, therefore, to keep the key policy rate of minus 0.5 per cent a year longer than previously indicated.
First at the beginning of 2018 expect Riksbanken to begin to raise the base rate slowly.
Riksbanken stresses that it relates the uncertainty to the inflasjonsprognosen, and that, therefore, in advance of the next trough in December is ready to proceed with the purchase of government bonds beyond those previously announced.
Riksbankens forecast for the key policy rate is now that the key policy rate will be cut to an average of minus 0.6 per cent in 2017. In 2018 is expected to average key policy rate to be minus 0.3 per cent and in 2019 it will be an average of 0.2 percent.
For comparison, Riksbankens the previous forecast in september that the key policy rate in average would be minus 0.5 per cent in 2017, in 2018 0 per cent and in 2019 0.2 percent.
Greater probability for interest rate cuts
at the same time with the interest rate decision also published Riksbanken a new monetary policy report. In the report type Riksbanken that the new rentebanen indicate a greater probability that interest rates may be cut further.
The new rentebanen indicates that the first renteheving comes first in the 2. quarter of 2018 and that there will be negative interest rates all the way to 2. quarter of 2019, writes analyst Jeanette Power Ebb in DNB Markets, in a note after the interest rate decision.
DNB Markets, considering it so that if inflation picks up and/or the european central bank announces expansion of quantitative easing, it seems likely that the Swedish program of quantitative easing to be extended in December.
– Further rate cuts seems more and more likely after today’s announcement, but we think it is less likely than the extension of quantitative easing, continuing the Current Flow.
Quantitative easing is to increase money supply by having the government buy up already existing promissory note, which the heads of state and virksomhetsobligasjoner, from banks and other financial institutions.
the Point is to get more money out of the market, and that banks should be able to lend more by reducing the borrowing costs.
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