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- The next question is surrounding the repo rate path. We expect this to remain flat for the forecast duration. The Riksbank has left the door open to cut verbally without communicating this through the rate path. As mentioned above, we are only around 1/8 of the way through the 2021 QE programme and the Riksbank (and many other central banks) have argued that negative rates are more effective in the post-pandemic recovery when demand can really be boosted effectively. And pretty sharp rebounds in demand are expected post-pandemic anyway as pent up demand is released and furloughed workers return to work. So at that point it is arguable whether negative rates would be needed at all – which we think its why there is no reflection of negative rates in the repo rate path. It would be seen as a vote of confidence from the Riksbank in the prospects of a recovery if a small uptick was added to the repo rate path towards the end of the forecast horizon. We look for little change to the medium-term growth and inflation forecasts.