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Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.
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The Riksbank Executive Board unanimously voted to cut rates by 50bps to 2.75% at the November meeting, as expected by MNI and the majority of analysts.
The policy statement said that rates may also be cut in December and during H1 2025 if “the outlook for economic activity and inflation remains the same”. This suggests a somewhat more dovish path for policy rates over the next few quarters compared to the September MPR, with the Riksbank wanting to “further support economic activity” (a strengthening of which is “a necessary condition for inflation to stabilise close to the target”).
Although the policy statement and press conference did not rule out further 50bp cuts, we think a return to a 25bp easing pace is the most likely scenario, particularly with the Riksbank cognisant of risks associated with the US election result.
The Riksbank will maintain a SEK20bln holding of nominal government bonds on its balance sheet, which means active sales of government bonds (“QT”) will conclude around the end of 2025.
The market reaction to the decision was relatively subdued, with a 50bp cut around 90% priced by markets and the policy guidance doing little to push back on expectations of further cuts.
Sign up now for free trial access to this content.
Please enter your details below.
Why MNI
MNI is the leading provider
of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.
Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.
MNI (LONDON)
EXECUTIVE SUMMARY
The Riksbank Executive Board unanimously voted to cut rates by 50bps to 2.75% at the November meeting, as expected by MNI and the majority of analysts.
The policy statement said that rates may also be cut in December and during H1 2025 if “the outlook for economic activity and inflation remains the same”. This suggests a somewhat more dovish path for policy rates over the next few quarters compared to the September MPR, with the Riksbank wanting to “further support economic activity” (a strengthening of which is “a necessary condition for inflation to stabilise close to the target”).
Although the policy statement and press conference did not rule out further 50bp cuts, we think a return to a 25bp easing pace is the most likely scenario, particularly with the Riksbank cognisant of risks associated with the US election result.
The Riksbank will maintain a SEK20bln holding of nominal government bonds on its balance sheet, which means active sales of government bonds (“QT”) will conclude around the end of 2025.
The market reaction to the decision was relatively subdued, with a 50bp cut around 90% priced by markets and the policy guidance doing little to push back on expectations of further cuts.
