The inflation rate in Sweden drops to 4 percent in September according to CPIF, compared to 4.7 percent in August. This is shown by new statistics from the Central Statistics Office (SCB).
- All surprises on the negative side suggest that there will be another interest rate increase, says Alexander Norén.
It is above all the electricity that drives down the prices, says SVT’s economic commentator Alexander Norén. What draws up KPIF are things like clothing, fuel, restaurants and hotels. All in all, this results in the CPIF falling by 0.7 percentage points compared to August.
- It is disappointing, because inflation is not falling as quickly as one hopes and as the Riksbank has expected. It is chewier than is healthy, he says.
Higher inflation than expected
The decrease in the inflation rate can be described as a “disappointment” because several analysts believed that it would fall further, something that could have extensive consequences for households.
- It was thought that it would go down to 3.7 percent and the Riksbank themselves had calculated 3.8. All the surprises on the negative side indicate that there will be another interest rate increase, says Alexander Norén.
Food prices are falling
Food prices also continue to fall slightly, except for certain goods, Statistics Sweden’s consumer price index for September shows.
The prices of fruit, coffee, tea and cocoa are increasing the most, writes Statistics Norway in a press release.
When will the interest rate drop?
How the rate of inflation affects mortgage rates depends on the time perspective one assumes, but according to Alexander Norén, it may have to get worse before it gets better.
- Soon, this inflation statement speaks against the Riksbank raising the interest rate in November. In the longer perspective, the trend is on the way down, and in that case we have seen the peak and then the interest rate will come down, he says.
Source: svt
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