Food prices have increased by 5.2 percent over the past year, with coffee, chocolate, and dairy products accounting for most of the increase.
It's products like these that can shoot up in price if something has happened to a crop. It would have been a bigger problem for the Swedish Central Bank if there had been price increases in many areas, says Alexandra Stråberg, chief economist at Länsförsäkringar.
Lower demand
Prices for many vegetables have fallen sharply compared to the same time last year. According to Annika Winsth, chief economist at Nordea, food prices were in line with expectations. However, prices for services show up lower than expected.
Perhaps it's due to a slightly lower demand for services.
Today's figures confirm the preliminary statistics from last week. Overall, the inflation rate in May, according to the KPIF measure, which is adjusted for interest rate changes, was 2.3 percent according to the final figures.
Speaks in favor of a reduction
Swedbank's chief economist Mattias Persson says that the outcome for inflation is a step towards the Swedish Central Bank reducing the interest rate next week.
The Swedish Central Bank needs to change its focus when it comes to inflation and support the Swedish economy, which has been weak for a long time.
The pure inflation, KPI, fell to 0.2 percent in May, down from the annual price change rate of 0.3 percent in April. Electricity prices were 10.3 percent higher in May than in the same month last year. Fuel prices were 15.6 percent lower than in May last year.
The big picture has not changed with today's figures, but we see a lower inflation pressure, which makes it possible for the Swedish Central Bank to lower the interest rate next week, which is what we have in our forecast, says Alexandra Stråberg.
