As expected, Sweden’s central bank has reduced interest rates by 0.25 percentage points to the lowest level since the end of WWII. The repo rate is now 2.5% with a prediction of the continued gradual recoveries of the world economy and the Swedish export markets and inflation less than 2%.
The Swedish government and trade union leaders have long been urging the bank to ease monetary policy.
However, in Paris, the Organisation for Economic Co-operation and Development (OECD) has been warning against reductions, claming that hikes will be needed when the world economy starts humming again.
The OECD praises Sweden for its sound state financing, but warns that there may be future problems in covering costs for the public sector.
Source: SR International