Today's announcement from the Riksbank regarding the interest rate decision was "reasonable", believes Jens Magnusson. He points out that the Riksbank's message is in line with the bank's own forecast, where the Riksbank will remain at the current interest rate level in 2026.
"I share the view that things look like they will improve next year. We should see an upturn in growth and consumption, but we have been somewhat negatively surprised during the year. It is therefore reasonable to retain a large degree of freedom of action," he says.
More likely to decrease
Riksbank Governor Erik Thedéen justifies today's decision as follows:
— With this interest rate, we will see a development that is beneficial for the Swedish economy. The data we have received and the forecasts we are making justify staying put.
Thedéen points out that there is "quite a lot of confidence" that the forecasts will be accurate in the short and medium term, but that it is important to be vigilant.
We are fully aware that these forecasts can be wrong and we have not settled down, he says.
Among other things, household consumption behavior and the government's expansive budget are highlighted as factors of uncertainty.
Since our last meeting at the end of September, developments have been broadly in line with our forecasts at the time.
In connection with today's interest rate announcement, the Riksbank is not publishing a new interest rate path:
–... but the message is that the interest rate path is holding up.
SEB's forecast is therefore also a key interest rate of 1.75 percent throughout 2026. However, Magnusson points out that a lot now depends on how unemployment figures and consumption develop in the future.
"I think the risks to that forecast are on the downside. In other words, it is more likely that there will be another cut than that we will get an early increase," he says.
If unemployment does not subside and the expected consumption upturn occurs, then it cannot be ruled out that the Riksbank will lower rates once again, he continues.
Warns of increase
Susanne Spector, Danske Bank's chief economist, interprets the announcement differently. She notes that the Riksbank's statement is lifting the government's expansionary budget for next year - something that could increase household consumption more than previously estimated. This could accelerate inflation.
It is reasonable to say that the Riksbank has clearly lowered the rate, but an increase is further away. However, the likelihood of an increase as early as next year has increased, she says.
