- The Riksbank said monetary policy will need to be tightened further to bring inflation back to its 2% target, and forecast further rises to interest rates over the next six months.
- “The development of inflation going forward is still difficult to assess and the Riksbank will adapt monetary policy as necessary to ensure that inflation is brought back to the target,” it said.
Sweden’s Riksbank on Tuesday launched a 100 basis point hike to interest rates, taking its main policy rate to 1.75%, as it warned that “inflation is too high.”
In a statement, the central bank said soaring inflation was “undermining households’ purchasing power and making it more difficult for both companies and households to plan their finances.”
The sharp hike comes as the U.S. Federal Reserve begins its two-day monetary policy meeting, with markets broadly expecting a 75 basis point increase as policymakers strive to get soaring prices under control.