Executive Board in the Committee on Finance'shearing on monetary policy in 2024

Presentation “As the inflation outlook became increasingly stable in 2024, we acted gradually but swiftly with the rate cuts. I consider it was a well-balanced strategy given the high-inflation environment we were coming out of and the risks surrounding developments.” These comments were made by Governor Erik Thedéen when he opened the Committee on Finance's hearing of the Executive Board on monetary policy in 2024 on Tuesday.

Date: 03/06/2025 09:00

Speaker: Governor Erik Thedéen

Place: Committee on Finance

Erik Thedéen, governor

Erik Thedéen, governor.

After two relatively dramatic years, with the highest inflation since the 1990s and a change in firms' pricing behaviour, underlying inflation remained high in early 2024. The geopolitical turmoil implied a risk of new supply disruptions, and there was a discussion in the rest of the world that it might be difficult to bring inflation down “the last mile”.  

“As a decision-maker, one has to constantly navigate an environment full of uncertainty and risk. In the first half of 2024, the risks of continued elevated inflation were tangible. We nevertheless began to ease monetary policy in the spring –earlier than many other central banks.” 

Annual average CPIF inflation was 1.9 per cent and long-term inflation expectations were close to 2 per cent. The Riksbank assesses that target fulfilment was good in 2024.

“The fact that inflation stabilised close to our target is, in my view, an indication that the monetary policy we pursued in 2023 and 2024 was reasonable and well-balanced.”

During the year, the Executive Board repeatedly emphasised the value of adjusting monetary policy gradually.  

“Acting gradually does not mean being hesitant or passive. As the inflation outlook became more stable and the risks of a weaker real economy increased, we cut the policy rate at an increasingly rapid pace, by a total of 1.5 percentage points by the end of the year.”

Mr Thedéen said that it had proved to be a wise strategy to act gradually, also given that uncertainty abroad increased sharply at the beginning of 2025 and that inflation in Sweden was slightly higher than expected.

About the Committee on Finance hearing

As part of the Committee on Finance's annual assessment of monetary policy, the Committee is holding a hearing of the Executive Board on monetary policy in 2024. The Riksbank's report Account of Monetary Policy forms a basis for the evaluation. The hearing also includes a presentation of the report "Swedish Monetary Policy 2024", which was commissioned by the Committee on Finance and produced by the Centre for Monetary Policy and Financial Stability (CeMoF ) at Stockholm University. This year's report is written by Professors John Hassler, Per Krusell and Roine Westman from Stockholm University and Dr Karin Kinnerud from BI Norwegian Business School in Oslo.

Updated 03/06/2025