Swedish inflation rises slightly above riksbank’s view in July
Source: FxWire Pro - Commentary / 14 Aug 2019 09:14:21 America/New_York
Swedish CPIF inflation came in slightly above the central bank’s forecast in July. On a year-on-year basis, the consumer price inflation came in at 1.7 percent, as compared with Riksbank and consensus expectations of 1.5 percent. Sequentially, consumer price inflation came in at 0.4 percent.
On a year-on-year basis, CPIF inflation came in at 1.5 percent, as compared with Riksbank’s expectation of 1.3 percent. Sequentially, CPIF inflation came in at 0.4 percent. Excluding energy, CPIF stood at 1.7 percent year-on-year. Food prices added 0.3 percentage points to the CPIF sequential figure. It was a broad upturn. Food prices are expected to probably remain high, affecting the inflation forecast for the months ahead, said Nordea Bank in a research report.
Electricity prices also came in higher than anticipated, positively contributing 0.21 percentage points. Costs for dental care subtracted 0.19 percentage points. Markedly, prices for accommodation, which have been high earlier in 2019, dropped back and lowered the CPIF by 0.09 percentage point, while price for car rental rose and added 0.04 percentage point. Services inflation dropped more than expected.
“All in all, inflation has been above the Riksbank’s forecast in June as well as in July, which gives the Riksbank some comfort. Moreover, Fed and ECB are easing monetary policy, Swedish GDP is contracting and employment declining. Thus, the higher than expected inflation is reducing the probability for stimulus measures rather than fuelling the arguments for a rate hike”, added Nordea Bank.© FxWire Pro 2020. All rights reserved. The FxWire Pro content received through this service is the intellectual property of FxWire Pro or its third party suppliers. Republication or redistribution of content provided by FxWire Pro is expressly prohibited without the prior written consent of FxWire Pro, except for personal and non-commercial use. Neither FxWire Pro nor its third party suppliers shall be liable for any errors, omissions or delays in content, or for any actions taken in reliance thereon.