Sweden’s central bank decided to maintain its negative interest rate and hinted a rate hike either in December or February.
The Executive Board of Riksbank left the repo rate unchanged at -0.50 percent, as widely expected, on Thursday.
“If the economy develops as expected, there will soon be scope to slowly reduce the support from monetary policy,” the bank said in a statement.
The forecast for the repo rate indicates that it will also be held unchanged at the monetary policy meeting in October and then raised by 0.25 percentage points either in December or February.
Deputy Governor Martin Flod?n entered a reservation against the repo rate path as he advocated a hike of quarter point at the October meeting.
Deputy Governor Henry Ohlsson voted against both the decision to maintain the repo rate at its current level and against the repo-rate path. He advocated raising the repo rate to ?0.25 percent.
The economy is forecast to grow 2 percent this year instead of 1.9 percent estimated previously. The outlook for 2020 was retained at 2.1 percent.
Rapidly rising energy prices helped to push up inflation. If energy prices are disregarded, inflationary pressures are still moderate, Riksbank noted.
The inflation rate is seen unchanged at 2.1 percent next year before easing to 1.9 percent in 2020.