Clothes demand bumps up Swedish inflation

Swedish prices rose by 0.2% in August from July and by 0.6% from August 2004, Statistics Sweden said on Tuesday, mostly because of higher prices for clothes and petrol.

Analysts had expected the monthly inflation figure to come in at 0.1% but accurately predicted the 0.6% rise for the 12-month period, according to a market poll by SME-Direkt.

After summer sales in July, prices for clothing and shoes rose by 3.1%, accounting for 0.1%age point of the overall increase, as did the 1.3% increase in petrol prices.

Meanwhile, prices for package holidays dropped by seven%.

When calculated according to a harmonized European index, Swedish prices rose by 1.0% in August over 12 months, and by 0.2% from the previous month.

The Swedish central bank, Riksbank, has an annual inflation target of 2.0%.