The Swedish Central Bank (Riksbank) lowered the policy rate by 25 basis points as expected in its second consecutive meeting; It stated that if the inflation and economic activity outlook remains unchanged, the policy rate could be lowered in the remaining two monetary policy meetings this year.

According to the statement made by the Riksbank, the benchmark interest rate was lowered from 3.50% to 3.25%. The market expectation was that the interest rate would be lowered by 25 basis points.

The statement stated that a 50 basis point cut is possible in one of the two meetings this year.

The statement said, “Furthermore, the forecast indicates that one or two more interest rate cuts will be made in the first half of 2025. Therefore, the policy rate is expected to be lowered at a clearly faster pace than previously reported, contributing to stronger economic activity and an inflation rate close to the target.”

The decision on the policy rate will be valid as of October 2. The minutes of the Governing Board’s monetary policy meeting will be published on October 1.

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