FXStreet (Edinburgh) - The Nordic central bank has left unchanged its benchmark rate at -0.35% at its meeting today. It has also increased its monthly purchases of bonds to SEK 65 billion from SEK 45 billion.
The Riksbank sees the domestic economy expanding at a strong pace while the inflation seems to have recovered the upward trend. In order to keep consumer prices on the upside, the central bank has considered keeping the expansionary stance in its monetary policy, in line with central banks overseas.
The central bank has also acknowledged the persistent risks associated with low interest rates and household indebtedness, arguing that “reforms are needed that create a better balance between supply and demand on the housing market. It is also important to review the tax system in order to reduce the incentive for households to take on debt”.
The Riksbank now sees the CPI a tad lower than its previous meeting, with consumer prices flat during 2015 and rising 1.4% in 2016 and 2.4% in 2017. On the GDP side, the economy is expected to expand 3.3% this year, 3.0% in 2016 and 2.7% in 2017.
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