Here is a man who surprises everyone with a new interest rate cuts – Aftenposten

The move is almost desperate, according to currency analyst Magne Østnor DNB Markets.

The Swedish central bank issued the surprising message on Twitter just before kl. 14, Wednesday afternoon.

It was not an ordinary monetary policy meeting in Riksbank Wednesday and decision is therefore extraordinary.

Responsive

– Inflation has bottomed out and is on way up. But the strengthening of the crown risking to break this trend. Hence the need for further action, writes Riksbank in twitter message.

Exchange in Stockholm reacted quickly to rise 0.6 percent.

First countries with negative policy rate

Last month introduced Sweden as the first industrialized country negative policy rate. Main justifications are getting up inflation which was negative through much of last year. In February, prices rose 0.1 percent.

“All” believe in Norwegian interest rate cut

The decision to Riksbank might affect Norges Bank’s interest meeting on Thursday.

Several analysts predict interest rate cuts.

Norges Bank lowered its key interest rate to 1.25 percent in December.

Stronger Norwegian crown

After the surprisingly clean decision was 100 Swedish kronor Wednesday afternoon 57 cents cheaper against Norwegian kroner.

Norges Bank official rate showed that the rate was 95.37 £ 95.80 £ toward Tuesday.

What does a negative interest rate?

– With negative borrowing rate in the Riksbank must Swedish banks pay to put money in the bank which helps to make this option less attractive. An object of negative interest rates to stimulate the economy. It happens by getting more money in circulation so that they can be invested or used for consumption, writes Svenska Dagbladet.

Although no Swedish banks have yet dared to introduce negative interest rates on private customers snnskuddskonto, it can happen . When risking depositors having to pay to have their money in the bank.

The four largest Swedish banks provide to the newspaper that they at longest wants to avoid introducing negative interest rates.

A option for them is to increase fees or introduce new taxes, the newspaper said.

Should weaken the crown

For the first time maintains Riksbank explicitly that the aggressive measures intended to weaken the strengthening of Swedish kronor that have taken place in the currency market, says Østnor DNB Markets.

He shows that the value of the Swedish krona, measured as a weighted average against other countries’ currencies, has risen 3 percent since mid-February.

But during the past two years, the Swedish krona weakened by 13 percent, he points out.

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Published: March 18. 2015 2:31 p.m.