Chief economists at various financial institutions are now beginning to question Sweden's central bank's, Riksbanken, aggressive monetary policy. "The experts" believe that Riksbanken should have been more patient, taken it more coolly and waited for the effect of each increase.
History of the Riksbank's increases
Current percentage Date
1.75% September 21, 2022
2.5% November 30, 2022
3% February 15, 2023
3.5% May 3, 2023
3.75% June 5, 2023
Although expectations were low for Sweden's growth, the report the Swedish Central Bureau of Statistics left on Friday came as a cold shower. Sweden's GDP fell by 1.5% during the period April-June 2023 compared to the same period last year.
It is a considerably stronger fall than the 0.5% in the forecast from the financial service Blomberg. However, some experts believe that the GDP result will be corrected when the definitive figures for June are reported.
The sharp drop in the economy is a consequence of less economic activity and a sign that the higher interest rates are beginning to be felt properly by the Swedish borrowers.
Considering the large proportion of Swedish mortgage holders who today have fixed interest rates on their mortgages and must refinance their loans in October 2023, I hope that Riksbanken takes it coolly on September 21, 2023.
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