SWEDEN
Swedish December CPIF ex-energy inflation was 2.0% Y/Y on a rounded basis (vs 2.1% flash, 2.4% prior). The unrounded flash print was 2.05%, so its not a huge surprise to see the final reading round down. The Riksbank projected a 2.23% Y/Y in the December MPR. Overall, underlying inflation continues to develop in a manner consistent with the 2% target. This should support a further Riksbank rate cut in January. Governor Thedeen's speech today at 1430GMT/1530CET is a key focus.
- On a seasonally adjusted basis using the X-13 methodology, CPIF ex-energy prices rose 0.14% M/M, the lowest sequential reading since August. This helped drive a deceleration in a broad range of momentum measures, with the exception of the 6M annualised rate.
- There were annual decelerations in restaurant and hotel (3.0% Y/Y vs 3.9% prior) and recreation and culture (0.6% Y/Y vs 1.9% prior) inflation.
- On the goods side, furniture and household equipment and clothing inflation also eased.
- Food and non-alcoholic beverage inflation, which some Riksbank Executive Board members have been tracking more closely over the last few months, eased to 1.7% Y/Y (vs 1.9% prior).
- Headline inflation confirmed flash estimates at 1.5% Y/Y (vs 1.8% Riksbank and prior).
- As expected, the sharp fall in electricity prices at the end of December weighed on the headline CPIF rate (-6.9% Y/Y, -2.7% M/M).
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