Riksbank holds firm at 1.75%, Swedish growth outlook upgraded

The Swedish Riksbank left the policy rate unchanged at 1.75%, as unanimously expected, and reaffirmed guidance that rates are likely to remain at this level for an extended period.

While the Bank upgraded its calendar-year growth outlook, the policy message remains one of patience rather than a shift towards near-term tightening. For FX, the decision reinforces SEK stability but does not materially alter our outlook or the rates narrative.

With inflation now close to target and broadly in line with the September forecast, the Riksbank is increasingly focused on the pace and durability of the recovery.

Recent data have pointed to firmer activity, even as the labour market remains soft. Against this backdrop, the Executive Board continues to favour a holding pattern, mirroring the ECB’s stance and emphasising conditionality rather than pre-commitment.

Aside from leaving the policy rate unchanged at 1.75%, the projected rate path remains flat through at least 2026 Q3 with only a very gradual rise thereafter.

This confirms a high bar for any near-term policy adjustment. The growth outlook was revised higher on a calendar-year basis. GDP is now forecast to expand 1.5% in 2025 and 2.9% in 2026, reflecting stronger recent momentum and early signs of stabilisation in the labour market. Inflation projections retain their familiar profile: CPIF is seen at 2.7% in 2025, falling to 0.9% in 2026 before moving back towards target in 2027. The Bank continues to see inflation expectations as well anchored.

All in all, the decision is quietly supportive of the krona but not transformative.

Improved growth prospects reduce downside risks and validate SEK resilience, yet explicit “hold-for-longer” guidance limits scope for rate-driven appreciation. In FX terms, this reinforces our outlook that sees EURSEK falling to around 10.7 in 3 months, with krona valuations and relative growth doing more of the work than monetary policy repricing.

Absent a material shift in either inflation expectations or global risk sentiment, the Riksbank’s stance argues for continuity rather than trend acceleration.

Author:

Barry van der Laan MBA, Senior FX Market Strategist

Disclaimer

This information has been prepared by Monex International Markets plc, part of Monex S.A.P.I. de C.V. (“Monex”). The material is for general information purposes only, and does not take into account your personal circumstances or objectives. Nothing in this material is, or should be considered to be, financial, investment or other advice on which reliance should be placed. No representation or warranty is given as to the accuracy or completeness of this information. All entities in the “Monex” group of companies are regulated for different products and services within the jurisdictions in which they operate. Details of the different entities can be found here. Details of the respective entities’ regulated status and available products and services can then be found on the relevant links to the individual jurisdictions’ website.