Sweden’s central bank keeps rates steady but warns of further tightening if inflation persists amid Middle East uncertainty.
The Riksbank left its policy rate unchanged at 1.75% but maintained a hawkish stance, indicating a potential rate hike later this year. The decision aligns with market expectations, though the bank remains prepared to tighten further if inflation trends upward persistently.
Recent data showed higher-than-forecast growth and inflation, raising concerns about underlying price pressures. The Riksbank cited the Middle East conflict as a key source of uncertainty, with its next meeting in late September likely to provide clearer guidance.
The rate decision had a neutral impact on the Swedish Krona (SEK), as markets had already priced in the hold.