December CPIF Seen Decelerating Toward Target, But Core To Remain Above 5% Y/Y (1/2)

Swedish CPI for December is due on Monday morning at 0700 GMT / 0800 CET. Consensus looks for CPIF ex-energy at 5.2% Y/Y (vs 5.4% prior) vs. Riksbank's November MPR forecast is 5.6% Y/Y.

• However, the Riksbank's forecast is stale following the 0.4pp miss in November (where 5.8% Y/Y was forecasted), so December CPI is almost mechanically expected to undershoot CB expectations.
• Should the Riksbank forecast error term widen in December, expectations for a softening of policy guidance at the next meeting on Feb 1 may increase. Rates are firmly expected to remain on hold.
• Indeed, in comments to reporters following yesterday's speech, Jansson noted that "I am completely open to revise the rate path and if it no longer appears suitable I’ll be the first to reconsider".