Ingves and Flodén at the Riksdag Committee on Finance: Hearing on monetary policy

Governor Ingves began the hearing by stating the reasons for the Riksbank's latest monetary policy decision to leave the repo rate unchanged at –0.50 per cent. He pointed out that a great deal of support has been required for a long time to bring inflation back to the target of 2 per cent. Now it is a question of keeping inflation close to the target going forward. Inflationary pressures are still rather moderate, but strong economic activity in Sweden and abroad is creating favourable conditions for inflation to stay close to target in the coming years. If things develop as expected, it is appropriate, in Governor Ingves opinion, to start increasing the interest rate at some point over the next few months, in either December or February.

Deputy Governor Flodén, who entered a reservation against the latest monetary policy decision, explained in his opening remarks why he thought it would have been appropriate to start increasing the interest rate in October. Inflation, which fell rapidly during 2014, has returned to being close to target and confidence in the inflation target has strengthened. This now makes it possible to take a step away from the most expansionary monetary policy, in Deputy Governor Flodén assessment.

Follow the link below to see the slides shown by Governor Ingves and Deputy Governor Flodén at the hearing.