Swedish inflation drops further below target to 1.3 percent

This compares with 1.5 percent in May, according to the agency.

"The inflation rate slowed down in June, partly due to lower food prices and transport costs," Mikael Nordin, a price statistician at Statistics Sweden, said in a press release.

The price of food and non-alcoholic beverages dropped by 6.8 percent year-on-year in June. The cost of healthcare, furniture, clothing, and footwear also fell.

If you don't take energy prices into account, inflation fell from 0.5 percent in May to 0.4 percent.

The drop in inflation was slightly smaller than expected. Analysts had on average forecast that inflation would fall to 1.2 percent in June, according to Bloomberg.

The Riksbank's inflation target is a CPIF inflation rate – which strips out the effect of mortgage rates – of 2.0 percent.