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Surveys published this week suggest that the Swiss economy is faltering after a strong first half of 2018, while inflationary pressures remain weak. This supports our view that the SNB will keep interest rates on hold much longer than investors expect. By …
2nd November 2018
While the minutes to the Riksbank’s October meeting all but confirmed that interest rates will start to rise in the coming months, a December hike is not a done deal. But regardless of whether the Bank starts tightening in December or February, we think …
Although Swiss headline inflation edged back up in October, the core rate was unchanged at a very low level. And as surveys of both manufacturers and consumers suggest that price pressures are muted, we expect the Swiss National Bank to stick to its very …
1st November 2018
While both the Riksbank and the Norges Bank kept monetary policy unchanged this week, they signalled in their policy statements that they intend to raise interest rates in the coming months. With inflationary pressures building, we expect the Riksbank to …
26th October 2018
Although it left its policy stance unchanged today, the Norges Bank struck a slightly more hawkish tone. We continue to think it will raise rates again next March. But even as the Bank tightens policy, we think that falling oil prices will cause the krone …
25th October 2018
Although the Riksbank left monetary policy unchanged today, it is still on track to begin raising interest rates in December. We think that the Bank will then tighten more quickly than investors expect, causing the krona to strengthen in 2019 and 2020. … …
24th October 2018
The latest data suggest that underlying inflation is picking up in Sweden, Norway and Iceland and we expect the central banks in all three countries to respond by tightening monetary policy. In Sweden, non-energy CPIF inflation rebounded in September and …
23rd October 2018
Safe-haven demand for the Swiss franc increased this week as the Italian Government clashed with the EU over its 2019 Budget. With worries about Italy set to persist, we think that the franc will weaken only slightly against the euro as the SNB lags …
19th October 2018
While the Riksbank, the Norges Bank and the ECB are likely to keep interest rates unchanged next week, we expect them all to signal tighter policy ahead. The recent rebound in underlying inflation will have made the Riksbank more confident in its plans to …
The era of record-low interest rates is nearly over in Sweden, but it is a long way from finished in Switzerland. The Swedish economy is powering ahead, generating inflationary pressure that the Riksbank will soon need to rein in. We expect it to begin …
18th October 2018
Inflation data published this week showed that price pressures are building in Sweden and Norway. We expect the Riksbank to begin raising interest rates in December. But while the Norges Bank looks set to raise interest rates again in the first half of …
12th October 2018
The rebound in non-energy inflation in September will reassure the Riksbank that it is right to be planning to tighten monetary policy in the coming months. We expect underlying inflation to continue to pick up, allowing the Bank to start raising interest …
11th October 2018
September’s strong inflation data are unlikely to change the Norges Bank’s plans to wait until Q1 next year before raising interest rates again. Looking beyond that, we think that falling oil prices will cause the Bank to end its tightening cycle sooner …
10th October 2018
The fall in Swiss inflation in September is a sign of things to come. Indeed, exchange rate effects and weak wage growth are set to ensure that price pressures remain very weak, keeping the SNB on hold until 2020. Meanwhile, although private sector …
5th October 2018
September’s Swiss inflation data provided further evidence that despite strong GDP growth, domestic price pressures remain very weak. And with the franc’s recent appreciation dampening imported inflation too, we expect the SNB to keep its policy rate on …
After almost five years of deflation, consumer prices are finally rising in Switzerland. But much of this has reflected higher energy costs, while underlying price pressures are still very weak. We therefore expect “lowflation” to persist, keeping the …
3rd October 2018
Although the Central Bank of Iceland left monetary policy unchanged today, it reiterated that it was prepared to take action if inflation expectations rise further. We think that this is likely and continue to expect the Bank to raise interest rates by …
September’s falls in the Swiss and Norwegian manufacturing PMIs leave them still pointing to strong growth in the sector. But it is in Sweden that price pressures seem to be strongest. … Manufacturing PMIs …
1st October 2018
There are still no signs that domestic political uncertainty is weighing on the Swedish economy, so we continue to expect the Riksbank to raise rates in December. Meanwhile, rising inflation expectations mean that Iceland’s central bank is likely to …
28th September 2018
Despite rebounding in September, the KOF Economic Barometer still suggests that Swiss GDP growth is set to slow over the coming months. And with inflation very weak, we expect the SNB to keep interest rates on hold until 2020. … Swiss KOF (Sep.) & Danish …
September’s further rise in the Economic Tendency Indicator suggests that neither uncertainty about the domestic political environment nor worries about rising trade protectionism have damaged the Swedish economy. … Sweden Economic Tendency Survey …
27th September 2018
Today’s ouster of Swedish Prime Minister Stefan Löfven might seem to justify yet another delay to the Riskbank’s policy normalisation plans. But the economy should continue to perform well and might even fare better under a new government. And since price …
25th September 2018
The Norges Bank’s “dovish hike” this week caused the krone to weaken, and we think that this is a sign of things to come. Meanwhile, the Swiss National Bank left policy unchanged, and we suspect that it will keep interest rates at record lows for longer …
21st September 2018
The Norges Bank has announced its first interest rate hike in seven years, but we suspect that the tightening process will be over much sooner than policymakers or investors envisage. … Norges Bank tightening to end sooner than most …
20th September 2018
The Swiss National Bank stuck firmly to its ultra-accommodative policy stance today and sounded more downbeat about the outlook, revising down its medium-term inflation forecasts in light of the recent appreciation of the franc. With inflation set to …
The Swiss and Nordic economies generally performed well in Q2, but most of the timelier survey indicators point to slower growth to come. Switzerland’s economy expanded very strongly in the first half of the year, boosted by revenues from international …
18th September 2018
Political uncertainty following Sweden’s general election last weekend is unlikely to meaningfully alter the Riksbank’s plans to start tightening policy around the turn of the year. Meanwhile, in Norway, stronger August inflation data this week will have …
14th September 2018
Although CPIF inflation was above target in August, the further decline in non-energy inflation will worry the Riksbank. If it remains soft, then the Bank will probably keep rates on hold until early 2019. … Swedish Consumer Prices …
While Sweden looks set for a period of political uncertainty, the broad fiscal consensus among mainstream politicians suggests that, whoever takes power, the near-term economic outlook will not be radically different. But given rising support for the …
11th September 2018
Following August’s increase in core inflation to a 19-month high, the Norges Bank is almost certain to raise interest rates at next week’s meeting. But policymakers remain cautious about the impact of tighter monetary policy, so they will move very slowly …
10th September 2018
Markets Overview – We think that a combination of policy loosening by major central banks, an increase in investor risk aversion, and mounting trade tensions will lead to bond yields in Switzerland and the Nordics staying lower for longer and equities …
9th September 2018
The latest opinion polls suggests that Sunday’s general election in Sweden will be a close call. But the outcome of the vote is unlikely to significantly alter the outlook for the economy or monetary policy. Meanwhile, data published this week showed that …
7th September 2018
Despite the more dovish tone of today’s policy announcement, the Riksbank looks likely to raise interest rates in December. We think that the Bank will then tighten more quickly in 2019 and 2020 than investors expect, causing the krona to strengthen. … …
6th September 2018
This morning’s GDP data and the timelier surveys show that the Swiss economy is growing at a fairly strong pace. But inflationary pressures remain subdued. As a result, we still think that the SNB will wait until 2020 before raising raise interest rates, …
In August, Swiss inflation was unchanged at its joint-highest level in over eight years. But underlying price pressures are subdued, and we think that falling oil prices and exchange rate effects will drag headline inflation down over the next year. So …
4th September 2018
The Swiss franc has strengthened against the euro this week, but we doubt that this will last. Meanwhile, we think that Sweden’s forthcoming general election is unlikely to have much of a macroeconomic impact. … Swiss franc strength unlikely to …
31st August 2018
Denmark had a weak first half of the year, but timelier evidence points to slightly faster growth in Q3. Meanwhile, Finland’s economy continues to perform well. … Finland & Denmark GDP …
Strong economic growth is fuelling inflationary pressures in both Norway and Sweden. So we expect the Norges Bank to follow through on its guidance and raise rates by 25bp next month. We doubt that Sweden’s Riksbank will be far behind and think that it …
30th August 2018
August’s surveys suggest that while economic growth is slowing in Switzerland, it remains very strong in Sweden. This is primarily due to differing conditions in the manufacturing sector, which might reflect the fact that the Swiss franc is historically …
Although the Central Bank of Iceland left policy unchanged today, it expressed concern about rising inflation expectations ahead of wage negotiations later this year. So domestic inflationary pressures are set to build further and we continue to expect …
29th August 2018
The upward pressure on the Swiss franc eased this week and our forecasts for monetary policy in Switzerland suggest that the currency will continue to depreciate against the euro over the next couple of years. Meanwhile, the latest opinion polls suggest …
24th August 2018
Even after its recent rise, we still think that the Swiss franc will weaken against the euro over the coming years as the Swiss National Bank lags the ECB in tightening monetary policy. But sustained demand for safe-haven assets suggests that the …
23rd August 2018
The slowdown in Norway’s housing market is weighing on the economy. But other sectors are performing much better, so this won’t be enough to stop the Norges Bank from raising interest rates next month. … Norway GDP & Switzerland IP …
Following September’s general election, Sweden looks set for a period of political uncertainty that might dent economic activity. But this is likely to prove temporary and we doubt that it would prevent the Riksbank from tightening monetary policy or the …
21st August 2018
The further appreciation of the franc this week strengthens our view that the SNB will be very cautious about policy tightening, keeping rates on hold until 2020. Meanwhile, with inflationary pressures building in Norway, we think the Norges Bank was …
17th August 2018
The latest inflation data in Switzerland and the Nordic economies show that underlying inflation is fairly low. But we doubt that this will stop the Norges Bank or Riksbank from raising interest rates this year. … Soft inflation won’t stop rate rises in …
16th August 2018
After leaving policy unchanged today, the Norges Bank looks almost certain to begin raising interest rates at its next meeting in September. But even as the central bank tightens monetary policy over the next few years, we think that falling oil prices …
The renewed appreciation of the Swiss franc this week as investors sought out safe haven assets will not have been welcomed by the SNB. But the franc is still weaker than it has been over the past few years so we do not expect the SNB to alter its stance. …
10th August 2018
Underlying inflation is still fairly weak in the Nordic economies. But given increased capacity utilisation and rising wage pressures in both Sweden and Norway, we expect both the Riksbank and the Norges Bank to start raising interest rates before the end …
Non-energy inflation in Sweden has been unexpectedly weak in recent months, prompting investors to push back their expectations of the first rate rise into 2019. But there is evidence of rising cost pressures, which we think will give the Riksbank …
8th August 2018
