The last time food prices rose higher was in December 2023.
It's a bit unsettling. There's nothing obvious that suggests it would swing back next month, says Jens Magnusson, chief economist at SEB.
Magnusson believes it will be more difficult for the Swedish Central Bank to lower interest rates when higher inflation pressure persists.
It's going to be a bit of a tug-of-war ahead: on the one hand, inflation continues to come in a bit too high, on the other hand, an economy that doesn't quite take off. Above all, private consumption that doesn't quite take off and would need a bit more stimulus from lower interest rates, he says.
"Mostly falukorv"
Coffee and butter are examples of food items that have risen sharply, plus 28 and 26 percent over a year, respectively. Even sweets and ice cream have become significantly more expensive, 9.4 percent in annual terms.
Dairy products such as milk, cheese, and eggs have collectively increased in price by 10.4 percent since February last year.
Marina Stepanenko in Skellefteå feels the price increases.
Now I try to buy the cheaper brands, even if they have worse quality. Previously, I mostly bought Swedish meat, for example. Now it's clear that Irish meat is cheaper, so sometimes you can opt for that, she says.
She keeps an eye out for campaigns and chooses different stores based on what they are cheap on. The family has chosen to cut back on sweets, hobbies, and attend fewer events.
We save on other things, because food is something you have to prioritize first, says Stepanenko.
Yvonne Frisk, also in Skellefteå, sometimes avoids buying meat. She also chooses the cheaper brands and buys in bulk.
It's mostly macaroni and falukorv. Not because I like falukorv, but you eat it. Everything is so expensive, she says.
Ongoing increase
Torbjörn Isaksson, chief analyst at Nordea, believes that production disruptions in raw materials, such as coffee, will continue to put upward pressure on prices.
I think there's a risk that food prices will continue to rise a bit in the coming months. For example, there's still a risk that the price of coffee will become even higher.
In the other scale, and something that can push food prices down, is the Swedish krona, which has strengthened.
The Swedish food market is very global. Even though we have domestic production, food prices are still heavily influenced by what happens in the world, says Torbjörn Isaksson.
The total inflation rate landed at 2.9 percent in February, according to the KPIF measure, which was the same figure as the preliminary statistics showed last week. Including interest rate changes, the pure inflation rate landed at 1.3 percent, up from 0.9 percent in price increase rate in January.
Among other price increases that lift inflation a bit extra are electricity prices, which rose by 8.9 percent on an annual basis. Even clothing has become on average 3.8 percent more expensive.
On the other hand, interest costs and fuel have fallen significantly, around 20 and 7 percent, respectively.
Source: Statistics Sweden (SCB)
