MNI BRIEF: Riksbank Cuts By 50bps; Notes Political Risk
MNI (LONDON) - The Riksbank cut rates 50bps Thursday, as expected, lowering the policy rate to 2.75% as policymakers said that previous guidance for a further cut in December and in the first half of next year remained in place.
The 50bps cut had been widely expected with inflation running below target and recent activity data coming in soft and the Riksbank Executive Board said "If the outlook for economic activity and inflation remains the same, the policy rate may also be cut in December and during the first half of 2025." (See MNI INTERVIEW: Inflation Confidence Key To Fast Cuts -Thedeen).
The board warned, however, of geopolitical uncertainty which could shift the policy stance noting that "economic developments are difficult to assess ... not least following the US election." In its assessment of developments since the September decision the RIksbank said that there were few clear signs of an economic recovery in the Swedish economy and that it was important for economic activity to strenghen.