Source: ForexYard
Statements being released from within the upper echelons of the Riksbank are now pointing to a possibility that interest rates will be held steady for the majority of next year. Sweden’s economy, which rebounded stronger and faster than most others during the recession, is now being affected by regional and global downturns in a variety of sectors.
The opinion of an interest rate freeze next year came after money market participants were surveyed by a commission sponsored by the bank. The Riksbank held rates at 2% last month despite being expected to increase them each month in 2011. Tightening financials and weakened demand for Swedish goods has put a damper on those plans of increasing rates through this year.
The downturn in exports from Swedish companies was also viewed as severe enough o hamper any possibility of an increase in the near future. So long as fundamentals remain weak, the Swedish economy isn’t likely to put further limitations on growth and checks on inflation.
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