Riksbank forecasts interest rate rise

After a meeting on Thursday, Sweden's Riksbank decided to keep the repo rate unchanged at 3.25 percent. The bank does however expect the rate to be raised gradually in the future and to a greater extent than was forecast in February.

The Riksbank’s decision is based on the economic indicators and inflation assessments presented in the February Monetary Policy Report and on the new information on economic developments received since then.

Wages, for example, are expected to increase at a faster rate than previously expected.

The bank did however point out that while current indications suggest a gradual interest rate increase, future economic developments remain uncertain.

“It is therefore also uncertain how the repo rate will develop in the future.

“This will depend as usual on new information on economic developments in Sweden and abroad and the effects this may have on economic activity and inflation in Sweden,” said the bank in a statement.