I can understand why they choose to wait

Full transparency, I voted for the incumbent Conservative government.

Yesterday, Sweden's central bank AKA Riksbanken announced its latest decision on the key interest rate. In line with the previous meeting, Riksbanken left the key interest rate unchanged at 4%, which is the highest level since 2008.

At the last meeting on 24 November 2023, Riksbanken warned that further increases in the key interest rate may come before reductions are considered. A reduction in the key interest rate could not come until the second half of 2025 at the earliest, Riksbanken said at the time.

In the press release from yesterday, Riksbanken confirmed that Swedish inflation has fallen and that activity in the economy has slowed down. They want to see this continue before they lower the key interest rate.

I fully understand that Riksbanken wants to wait a couple of months to ensure that inflation does not rise again. In my opinion, there is a risk of inflation picking up again due to our current government choosing to raise the energy tax at the beginning of this year instead of lowering it as promised.

Another factor that will affect inflation in the short term is that all cargo ships going around Africa and the Cape of Good Hope instead of using the Suez Canal. A sea route that around 30% of all the world's freighters used to use. The reason for this is that the Iran-backed Houthi movement, which controls parts of Yemen, is attacking cargo ships.

The next monetary policy announcement from Riksbanken is on 27 March 2024. Hopefully they will lower the key interest rate then.