Major Bank Expects Only One Interest Rate Cut

The Swedish Central Bank presented at its latest meeting in December an interest rate path almost unchanged from September. We interpret this as the board's confidence that the Swedish economy will develop according to their expectations and that the level of the repo rate at 2.25 percent, which according to the interest rate path will apply going forward, is well-balanced, writes the bank in a market update.

DNB writes that an alternative would be to wait until March with an interest rate cut. The bank reasons, however, that it is less likely since it would "entail an unnecessary delay of the further support that the Swedish Central Bank has deemed necessary to stimulate activity in the Swedish economy".