Swedish central bank cuts key interest rate to 2.0pct
By Reuters
STOCKHOLM: Sweden's central bank cut its key interest rate to 2.0 per cent from 2.25 per cent as expected on Wednesday, saying mild inflationary pressures gave it room to boost weak economic growth.
"The economic recovery that began last year has lost momentum, and inflation is expected to be somewhat lower than in the previous forecast," the Riksbank said in a statement.
"The forecast for the policy rate entails some probability of another cut this year."
The central bank last cut the policy rate in February this year when it said an easing cycle that began in spring 2024 was likely done.
However, uncertainty surrounding US President Donald Trump's on-again, off-again tariff policies have hit business and household sentiment, squeezing growth.
Holding the policy rate unchanged in May, the Riksbank said that if inflation remained tame – as expected – easier policy could be justified in the months ahead.
The latest figures showed only mild price pressure and the overwhelming majority of analysts in a Reuters poll expected a rate cut.
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