Riksbank Holds Rate, Calls Stance Well-Balanced

• The Executive Board judges it well-balanced to leave the policy rate unchanged.
• Inflation runs higher than the Riksbank's June forecast.
• Labour market performance is somewhat weaker than expected.
• GDP growth comes in stronger than forecast.
• Underlying inflation carries a risk of becoming too high.

Policy Decision

Sweden's Riksbank Executive Board judges it well-balanced to leave the policy rate unchanged. The Riksbank says a rate-increase probability assessment remains in place. Policymakers would tighten if the inflation upturn proves larger and more lasting.

Riksbank Holds Rate, Calls Stance Well-Balanced

Inflation

Inflation runs higher than the Riksbank's June forecast. Growth and inflation combined also exceed the June forecast. Measured inflation remains low, and still low on a separate reading. Underlying inflation carries a risk of becoming too high. Company pricing plans stay subdued.

Labour Market

Labour market performance runs somewhat weaker than expected. The comparison to expectation shows the same weaker reading. Unemployment stays high.

Growth

GDP growth comes in stronger than forecast. Economic sentiment has clearly improved. Markets and companies show signs of adaptation.

External Backdrop

The war in the Middle East shows an economic effect smaller than initially feared. The United States and Iran still have no peace agreement. Oil prices have come down since spring. Global supply-chain disruption has declined.

Outlook and Risks

The overall economic outlook stays largely unchanged. Uncertainty remains considerable.