Anna Breman in Sala: Low and stable inflation contributes to stronger economic development

In her presentation, Ms Breman talks about how the town's history is linked to that of the Riksbank.

"Like Sala, the Riksbank was founded in the 17th century, and the town has played an important part in the development of the Swedish payment system, because the silver in our Swedish coins came from the Sala silver mine."

The Riksbank's task has not remained exactly the same over the centuries. But it is fundamentally the same now as it was then – to create the conditions for good economic development. Low and stable inflation is a prerequisite for the Swedish economy to perform well.

“Inflation is now well on the way to stabilising close to the target and the outlook for inflation is also favourable in the medium term. We were therefore able to ease monetary policy further in August and cut the policy rate to 3.5 per cent. We also signalled that the rate may be cut two or three more times this year. Lower interest rates and low and stable inflation improve households’ purchasing power and facilitate corporate investments. This contributes to a stronger growth in the Swedish economy."  

Ms Breman emphasises the importance of continuing to adjust monetary policy to inflation.

“If new information clearly changes the inflation outlook, we need to be able to make different decisions than those indicated by the interest rate path. It is not, however, individual monthly outcomes that determine the direction of monetary policy; instead it is an assessment of where inflation is heading in the medium run.”