Borg ‘not worried’ by inflation

Sweden's Finance Minister Anders Borg has said he is not worried by figures showing that inflation is at its highest level since 1993. But in an interview on Sveriges Television he said the government would make "a significant downwards revision" of its growth predictions when it revealed its spring budget.

The opposition has blamed in part the government’s tax cuts for the latest inflation figure, which according to a report by Statistics Sweden in December stood at 3.5 percent, the highest level since 1993. But Borg pointed out in the interview with veteran broadcaster K-G Bergström that underlying inflation was still at 2 percent, in line with the Riksbank’s price stability target:

“Sometimes it’s a bit higher, sometimes a bit lower. And when it’s linked with international factors such as food and petrol prices, I don’t feel terribly worried about it. Most experts believe that inflation will fall in the coming years,” he said.

Borg also said that there were clear signs that growth was falling internationally:

“We are seeing a slowdown internationally, with the American mortgage market and clear effects on Swedish exports. So it is conceivable that growth will be a little lower,” he said.

“This means a significant downwards revision from our earlier prognosis. We will put specific figures on it in the spring budget,” he said.