Thedéen in Härjedalen on the Riksbank’s mandate and the economic situation

Thedéen said that the Swedish economy is starting from a good position in an uncertain world. The cyclical recovery has begun and, as household purchasing power strengthens, there are conditions in place for stronger economic growth and lower unemployment. Inflation is close to the Riksbank’s target but is expected to decline during the year, partly as a result of the temporary reduction in VAT on food.

The Riksbank’s latest assessment is that the policy rate will remain at 1.75 per cent for some time. “My assessment at the January meeting was that monetary policy is on a stable and reasonable course, allowing us to tolerate minor deviations in outcomes without immediately changing the direction that has been set.”

However, Thedéen emphasised that the Riksbank remains vigilant and prepared to adjust monetary policy if the outlook changes. “The latest information suggests that the recovery is continuing, while underlying inflation may be somewhat lower this year than in the most recent forecast. However, before our next monetary policy meeting, additional information will become available that we need to analyse in order to assess the economic and inflation outlook.”

In his discussions with business representatives, he also addressed developments in the payments market and the declining use of cash. Cash remains important for society, particularly for reasons of contingency and inclusion. However, the cash infrastructure needs to function significantly better, Thedéen said.

“For example, retailers currently face major difficulties in obtaining petty cash and depositing their daily cash takings. We therefore welcome the proposed legislation that would impose stronger requirements on banks to offer businesses services tailored to their needs for depositing daily cash takings.”