Swedish rates cut to historic low

The Swedish Riksbank has cut its key interest rate by 50 basis points to an historic low level of 1.5 percent, in a bid to spur economic growth following weak recent macroeconomic data.

Analysts had anticipated a rate cut of 25 basis points, to 1.75 pct, Carnegie brokerage said.

“GDP growth slackened more than anticipated at the beginning of the year in both Sweden and the euro area. The forecast for Swedish GDP growth has therefore been revised down substantially for this year and slightly for next year,” the central bank said in a statement.

“Over the coming years inflation is therefore expected to be clearly below the 2 pct inflation target,” it added.