Swedish households can rejoice in a trend break when it comes to food prices that fell (0.7 percent) in August, the first decline this year. Among the goods whose prices fell the most are, for example, leeks, grapes and cabbage, according to SCB.
According to Alexandra Stråberg, chief economist at Länsförsäkringar, it is "very positive" that food prices are falling.
Even if it was a strange combination of grapes and cabbage, you have to be happy about the little, she says.
Leeks also fell in price, while dairy products, sweets, ice cream and chocolate rose.
Apart from seasonal patterns, an important factor behind the decline is that the Swedish krona has strengthened during the year. This dampens the price of imported food. In addition, energy prices are staying low, says Andreas Wallström, forecast manager at Swedbank.
Prices stabilize
Swedbank's assessment is now that food prices will continue to remain stable this year.
The final inflation figures for August also mean a downward revision, from preliminary 3.3 percent to 3.2 percent, according to the KPIF measure, which the Swedish Central Bank follows closely.
According to Alexandra Stråberg, inflation is still high. But she sees it as positive that the final KPIF inflation was slightly lower than the preliminary figure.
This opens up for a possible interest rate cut from the Swedish Central Bank in September, it's hanging in the balance now. It's the right trend and it's getting closer to the Swedish Central Bank's own forecast, she says.
Secures the Swedish Central Bank
Andreas Wallström at Swedbank says that right now it is "very open" what the Swedish Central Bank will do next.
Our assessment is that there will be a cut, but it's absolutely not a given. This can, however, make the Swedish Central Bank a bit more secure to move forward and cut the interest rate, he says about today's figures.
The next interest rate decision from the Swedish Central Bank will come on September 23. Swedbank's assessment is that there will be a cut then rather than at the November meeting.
