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RIKSBANK: September Minutes: Bunge Steers Clear of 50bp Cut Support

RIKSBANK

Some initial excerpts from the Riksbank Executive Board meeting minutes. Bunge stands out as most openly against the idea of 50bp cuts, but Thedeen re-emphasises that larger moves are still consistent with a “gradual” approach to policy (in line with his interview with the MNI Policy Team last week).

  • Jansson: “In addition to the favourable development of inflation, developments in the real economy also play a major role in why I believe that it is now appropriate to opt for a slightly greater easing in monetary policy”… “My hope is that our bolder monetary policy plan will contribute to greater optimism and confidence among households and businesses”
  • Bunge: “The forecast also includes a certain probability of a cut of 0.5 percentage points at one of the coming meetings. For my part, I would very much like to minimise the significance of a possible cut of 0.5 percentage points at a specific meeting”
  • Breman: “. I continue to see further gradual interest rate cuts as a well-balanced monetary policy and I do not wish to repeat what I said last time about this”….” . I therefore support a rate cut at today’s meeting and a clear downward revision of the policy rate path, with some likelihood of a 0.5 percentage point cut at future meetings. If the outlook for inflation changes, monetary policy will be adjusted”
  • Seim: “My overall assessment is thus that there are factors that dampen the risk of persistently lower inflation in Sweden at present, but this is something we should monitor carefully”.
  • Thedeen: “The gradual approach we have chosen also allows for the possibility of a 0.5 percentage point cut at one of the two remaining meetings this year, in line with what is set out in the draft report. The fact that we explicitly state in the draft report that we may make cuts in larger steps is a clear indication that, given the favourable inflation outlook, this is now part of our gradual monetary policy strategy”.
  • We will take a deeper look at the minutes later today.
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Some initial excerpts from the Riksbank Executive Board meeting minutes. Bunge stands out as most openly against the idea of 50bp cuts, but Thedeen re-emphasises that larger moves are still consistent with a “gradual” approach to policy (in line with his interview with the MNI Policy Team last week).

  • Jansson: “In addition to the favourable development of inflation, developments in the real economy also play a major role in why I believe that it is now appropriate to opt for a slightly greater easing in monetary policy”… “My hope is that our bolder monetary policy plan will contribute to greater optimism and confidence among households and businesses”
  • Bunge: “The forecast also includes a certain probability of a cut of 0.5 percentage points at one of the coming meetings. For my part, I would very much like to minimise the significance of a possible cut of 0.5 percentage points at a specific meeting”
  • Breman: “. I continue to see further gradual interest rate cuts as a well-balanced monetary policy and I do not wish to repeat what I said last time about this”….” . I therefore support a rate cut at today’s meeting and a clear downward revision of the policy rate path, with some likelihood of a 0.5 percentage point cut at future meetings. If the outlook for inflation changes, monetary policy will be adjusted”
  • Seim: “My overall assessment is thus that there are factors that dampen the risk of persistently lower inflation in Sweden at present, but this is something we should monitor carefully”.
  • Thedeen: “The gradual approach we have chosen also allows for the possibility of a 0.5 percentage point cut at one of the two remaining meetings this year, in line with what is set out in the draft report. The fact that we explicitly state in the draft report that we may make cuts in larger steps is a clear indication that, given the favourable inflation outlook, this is now part of our gradual monetary policy strategy”.
  • We will take a deeper look at the minutes later today.