MNI BRIEF: Riksbank Holds, Sees First In May Or June

The Riksbank left its policy rate on hold at 4.0% at its March meeting and said it could make its first cycle cut in either May or June.

"If the inflation prospects remain favourable, the policy rate may well be cut in May or June," the Board stated, making the case for "gradual cuts in the policy rate." The Swedish central bank's board remains concerned about potential krona weakness or fresh adverse geo-political developments driving inflation up again.

Its policy rate path showed that after the first cut there will only be another five at most over the next three years, with the forecast rate at 2.6% in three years' time. Inflation on the target CPIF measure, CPI with a fixed interest rate, was shown just above target this year and just below in 2025 with GDP growth rebounding from 0.3% in 2024 to 1.9% in 2025.