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Uncertainty Around Weightings Ahead Of January CPI


Sweden’s January CPI release is due on Monday at 0700GMT/0800CET.

  • Analysts expect CPIF ex-energy to print at +4.4% Y/Y (vs +5.3% prior), with Nomura a standout on the downside looking for 3.9% Y/Y. The Riksbank's November MPR sees CPIF ex-energy at +4.51% Y/Y, although that forecast was made more than 2 months ago.
  • Analysts note that the reweighting of the CPIF basket adds two-way uncertainty to the January print.
  • Aside from this, electricity base effects are seen pushing headline inflation higher to +3.1% Y/Y (vs +2.3% prior; Riksbank exp. +3.15%).
  • Services inflation may see a temporary uptick, with some analysts pointing to higher rents in January and expectations for that dynamic to play out across 2024 on the whole.
  • Food prices are generally seen rising on the month.
  • Markets will as always be sensitive to the inflation release, particularly after the Riksbank opened the door to rate cuts as early has H124 at its February decision.
  • However, we suspect the bar to rate cuts is set quite high at this stage, and a run of downside inflation surprises will be needed before a March cut is even considered.
  • We also believe the idea of a May cuts seems a little premature at this stage, but concede that there is plenty of data scheduled for release between now and then.
  • Click for a selection of domestic analyst comments:

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