From a trade union perspective, the message is clear.
"To get sufficient momentum in the economy, two, perhaps three, interest rate cuts are needed this year," says Tobias Brännemo, chief economist at Unionen.
Divided economists
However, among bank economists, the picture is increasingly divided about what is expected. Nordea's economists confirmed in a forecast last week that they expect two interest rate cuts during the spring. But their colleagues at Handelsbanken said that last week's cut will be the last for a while.
DNB's economists have since joined Handelsbanken's track in a fresh analysis – which is also in line with the Swedish Central Bank's so-called interest rate path. One more cut, DNB believes, in January or March.
"Further easing is not likely at present," writes Ulf Andersson, chief economist at DNB Sweden, in a press release.
A survey from SEB shows that around 85 percent of investors expect an interest rate cut on Wednesday. And the 12 percent of investors who believe that the Swedish Central Bank will leave the interest rate unchanged at 2.50 percent on Wednesday instead expect a cut in March.
"Quite a significant repricing"
Just a few weeks ago, many more interest rate cuts were priced into the interest rate market positions.
Looking directly at the pricing on the interest rate market, it points quite clearly to two more cuts. The probability of this scenario is 90 percent, according to Amanda Sundström, interest rate strategist at SEB.
But there has been a quite significant repricing, in line with the rise in interest rates abroad. Then the expectations of the Swedish Central Bank have been pulled back a bit, she says.
Signs of a Swedish recovery have contributed to changing the market's picture of what is expected.
But above all, it's about what happens abroad, says Sundström.
A strong US economy – where the newly elected President Donald Trump is feared to drive up inflation pressure with tax cuts, tariffs, and deportations – is a driving factor.
Looking at the pricing all the way into 2026, it has even started to swing towards the possibility of a rate hike from the Swedish Central Bank next year – that is, an increase in the interest rate again.
But one should be cautious when reading into that far out on the curve, says Sundström.
The Swedish Central Bank has since May 2024 cut the interest rate five times, from 4.00 to 2.50 percent. And the board, with Erik Thedéen as chairman, has flagged at least one more cut if nothing dramatic happens regarding inflation.
If it becomes one or two cuts, it can have a decisive impact on variable mortgage rates, which usually follow the interest rate – both up and down. If the mortgage rate is pushed down by 0.25 percentage points, it would reduce the interest cost of a loan of three million by 625 kronor per month, excluding the effects of interest deductions.
If the mortgage rate follows down after two cuts – or a double cut – the interest cost of the same mortgage would then fall twice as much: 1,250 kronor per month.
