The next interest rate announcement from the Swedish Central Bank will come in August. National economist Lars Calmfors believes that the Swedish Central Bank can afford a double cut in the interest rate if inflation continues to decline, writes Di.
If the July inflation rate also falls below the Swedish Central Bank's inflation target of 2 percent, I find it hard to see why the Swedish Central Bank would take a slow approach and settle for a 25-point cut, he says to Di.
He argues that a too cautious approach risks prolonging the recession. The Swedish Central Bank, on the other hand, wants to proceed gradually with its cuts.
Everyone agrees that the economy is in a recession and most indications suggest that inflation will come in below target going forward, which provides strong arguments for a 50-point cut, says Calmfors.
The Swedish Central Bank will announce its interest rate decision on August 20. The week before, on August 14, the Statistics Sweden (SCB) will present inflation figures for July.
