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Headline Inflation Slows, Continued Acceleration in CPIF ex Energy

SWEDEN
MNI (London)

SWEDEN JUL CPI +0.1% M/M, +8.5% Y/Y (FCST +8.7%); JUN +8.7% Y/Y

SWEDEN JUL CPIF -0.2% M/M, +8.0% Y/Y (FCST 8.3%); JUN +8.5% Y/Y

  • Swedish CPI was softer than anticipated across the board, with headline inflation slowing to +0.1% m/m and +8.5% y/y, down 1.3pp and 0.2pp respectively.
  • The Riksbank-watched CPIF underlying inflation print slowed for the first time since January, by 0.5pp to +8.0% y/y (8.3% expected), whilst the month-on-month reading saw a contraction of -0.2% m/m (+0.1% forecasted).
  • Electricity and fuel prices accounted to the deceleration in CPIF, which was largely offset by the +3.2% m/m jump in food prices which is only partly seasonal. CPIF excluding energy saw another 0.5pp jump to +6.6% y/y in July, underlining the continued building of widespread price pressures despite some minimal reduction in month-on-month clothing and furnishing costs.
  • This data provides mixed messages for the RIksbank ahead of the September 19 meeting, as the targeted CPIF rate saw some easing, however excluding energy inflation pressures continue to mount in the Swedish economy. The August inflation print is due on September 14 and is likely to generate more reaction as markets look for another 50bp hike.

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