MNI BRIEF: Riksbank Ups Rate 50bps, Sees One More Hike

The Riksbank's Executive Board delivered a widely anticipated 50 basis point hike, lifting the policy rate to 3.5%, at its April meeting, although two members dissented prefering a 25 bps increase and its forecasts and commentary suggested that it was nearly at peak, with one more 25 bps hike likely either in June or September. (MNI RIKSBANK WATCH: April Hike, Rates To Stay At Peak)

The detailed collective rate path showed the policy rate holding at a 3.65% peak, up from 3.33% in the February forecasts and this time around it switched to show some reversal of the tightening down the track, with the policy rate falling back to 3.35% by the end of the three year forecast.

First Deputy Governor Anna Breman and Martin Floden both dissented in favour of a more gradualist approach, backing a 25 bps hike with a higher probability on another hike in June or September. The target inflation measure, CPIF, was projected to come in higher than previously expected throughout the forecast, returning to target only in Q2 2025.