Sweden Interest Rate

The Swedish Riksbank cut its policy rate by 25bps to 2% in June, in line with expectations, as the country's economic recovery slows and inflation eases. Recent data shows weaker growth and persistently high unemployment, while inflation has aligned with previous forecasts but is expected to fall slightly below earlier projections due to weaker demand. The rate cut aims to stabilize inflation at target and support the economy. The central bank also signaled a possibility of another cut later this year. Global uncertainty, driven by trade tensions and the escalating Middle East conflict, continues to weigh on the outlook. Although financial markets have calmed somewhat and some tariffs may be lower than previously anticipated, geopolitical risks remain high. Domestically, rising real wages offer some support, but the pace of recovery is slower than expected. The future path of monetary policy will depend on new data and how it affects inflation and growth expectations.