Swedbank Predicts Swedish Central Bank to Cut Interest Rates Again

The Swedish Central Bank must act to handle the consequences of the Trump administration's tariffs, according to Swedbank's chief economist Andreas Wallström. At least one interest rate cut is a new main scenario among the bank's economists.

» Published: April 07 2025

Swedbank Predicts Swedish Central Bank to Cut Interest Rates Again
Photo: Christine Olsson/TT

"The prospects for a rapid recovery in the Swedish economy are further clouded by global uncertainty and tariffs that will hit Swedish exports. Moreover, we see a weaker inflation pressure. Overall, this means that the Swedish Central Bank will need to act," writes Andreas Wallström.

Swedbank's economists have, as a result of the development, revised their forecast that Swedish GDP growth this year will remain at 1.5 percent and that the Swedish Central Bank will lower the interest rate.

"At least once more, to 2 percent," writes Wallström.

Previously, Swedbank's economists expected the Swedish Central Bank to be done with its interest rate cuts for the year after the interest rate cut to 2.25 percent in January and that growth this year would be around 2 percent.

A consequence of the development is that the variable mortgage rates will fall slightly more this year compared to the previous forecast, to an average of 3.1 percent, according to Swedbank's economists.

Loading related articles...

Tags

TTT
By TTTranslated and adapted by Sweden Herald
Loading related posts...