Sweden’s central bank held its policy rate at 1.75% on June 17, signaling it’s comfortable for now, but ready to raise rates later this year if inflation starts acting up again.
The decision, effective June 24, marks the fifth consecutive meeting where the Riksbank has left rates untouched. The easing cycle is over, and the next move could be upward.
Why the Riksbank is keeping its powder dry
Swedish inflation is currently running below the 2% target. The Riksbank pointed to geopolitical uncertainties, particularly ongoing conflicts in the Middle East, as a key source of upside inflation risk. Global instability could push energy and commodity prices higher, which would eventually filter into consumer prices back home.
The central bank acknowledged that economic activity in Sweden remains below normal levels, but officials noted emerging signs that a recovery could be taking shape.
