Sweden’s central bank keeps borrowing costs steady as subdued inflation counters global energy and geopolitical risks.
The Riksbank left its benchmark interest rate unchanged at 1.75% in May, opting for a cautious approach as weak domestic inflation offsets external pressures. The decision reflects concerns over sluggish price growth despite rising global energy costs and geopolitical tensions, including the conflict in Iran.
Analysts had expected the hold, citing recent inflation prints below the bank’s target. The Riksbank last adjusted rates in February, when it signaled a prolonged pause amid economic uncertainty. Comparable central banks, including the ECB, have also adopted a wait-and-see stance as inflation dynamics evolve.
Markets showed limited reaction, with the Swedish krona (SEK) trading marginally lower against the euro following the announcement.