Flodén and Jansson Remain Board Doves In Minutes

Comments from the remaining Executive Board members in the January minutes suggest Jansson and Flodén remain toward the dovish end of spectrum, while Breman and Bunge's stances are more balanced (similar to Thedéen).

• On the timing of rate cuts: Breman and Bunge note it is likely the policy rate will be cut earlier than the November forecast indicated, but do not assign a timeframe. Jansson provides more colour, stating that "a first rate cut at the meeting either in May or in June currently feels significantly more realistic [than March]". Meanwhile Flodén believes that "a policy rate cut in the second or third quarter of this year, seems increasingly reasonable as a likely scenario for a well-balanced monetary policy going forward".
• Clearly, the Riksbank does not want to entertain a rate cut in March unless absolutely warranted by the data.
• On risks to the outlook: Board members note that a weaker krona remains a key risk to the inflation outlook, particularly given the exchange rate's depreciation since the turn of the year. Furthermore, while price plans (e.g. in the Economic Tendency Survey) have fallen from highs, Flodén, Bunge and Breman still caution that they remain at elevated levels.
• In a pushback against current market pricing, First Dep. Gov. Breman noted that "expectations of rapid rate cuts may require us to keep the policy rate at its current level for longer than otherwise would have been necessary".
• Similar to Thedéen, little additional colour was given to the decision on QT.