Riksbank holds policy rate at 1.75% as Middle East war clouds inflation outlook

Sweden's Riksbank left its policy rate unchanged at 1.75 per cent, the central bank said in its May 7 press release. The Executive Board judged that the risk of the war in the Middle East pushing inflation higher has increased somewhat, but noted inflation is currently below target, recent outcomes have been clearly lower than the Riksbank's March forecast, and economic activity is weak. That combination gives scope to wait for a clearer picture of the war's effects and the supply shocks it entails, the bank said, adding that the current rate level leaves it well positioned to adjust policy if needed to safeguard the inflation target.