A central bank that uses its interest rate weapon against its own citizens

Sweden's central bank AKA Riksbanken announced today its decision to leave the policy rate unchanged for the second time in a row. In the publication, Riksbanken also informed that they intend to lower the policy rate three times within the next twelve months.

The next publications from Riksbanken on the remaining monetary policy decisions in 2024 will be submitted according to the dates below:

May 8

June 27

August 20

September 25

November 6

December 18

My assumption is still that the first policy rate cut will come on August, 20. I believe that Riksbanken intends to use the policy rate as a tool to prevent Swedish borrowers from living an overly extravagant life during the upcoming summer holidays, which in the worst case will lead to inflation gaining momentum again.

With today's interest rates, the majority of Swedish borrowers must prioritize interest payments over travel and consumption.