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Swedish central bank chief says no time to wait on soaring inflation

Economy Sep 01, 2022 16:45
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© Reuters. FILE PHOTO: Chairman of the Basel Committee on Banking Supervision Stefan Ingves attends a news conference at the ECB headquarters in Frankfurt, Germany, December 7, 2017. REUTERS/Ralph Orlowski

STOCKHOLM (Reuters) -Sweden's central bank cannot afford to wait and see what is going to happen to inflation, but needs to act now, central bank Governor Stefan Ingves said on Thursday.

Inflation is running at around 8% in Sweden and the central bank has forecast its policy rate will rise to around 2% by early next year from the current 0.75%.

However, with inflation coming in above the central bank's forecasts for the last couple of months, many analysts expect the Riksbank to have to move faster and further.

"In a 30-year perspective, we have never had so high inflation as we have today and we have never been so far from the inflation target as we are today," Ingves told reporters.

"That suggests that we shouldn't just take a wait and see approach but should ... make it clear that we will do what we can to meet our inflation target."

Ingves said that just a year ago, the Riksbank had expected the spike in inflation to be temporary and had got it wrong. "In a certain sense, we waited and saw already and we know what happened," he said.

The central bank will announce its next policy decision on Sept. 20 and many analysts expect it to hike by 75 basis points to 1.5%.

A further hike - possibly of a half-percentage point - is expected in November. The Riksbank has already hiked twice this year.

Swedish central bank chief says no time to wait on soaring inflation
 

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