MNI Riksbank Preview - December 2025: No Policy Pivot Yet

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EXECUTIVE SUMMARY: 

• The Riksbank is expected to hold the policy rate at 1.75% on Thursday, in a quarterly decision which includes an updated MPR and rate path projection. We expect the policy statement to re-iterate that the policy rate will be kept at 1.75% for “some time”.
• The main focus should be on the first three quarters of the updated rate path. This is the part of the curve that is “owned” by the Executive Board, and therefore constitutes a policy signal (beyond that is a staff forecast). 
• We expect the rate path to remain at 1.75% in Q1 and Q2, as muted inflation developments and a stubbornly high LFS unemployment rate guard against a hawkish revision. However, we think it is likely that the Q3 2026 point will be revised up by two or three basis points, owing to strengthening activity momentum, supportive monetary policy and the anticipated expansion of fiscal policy from next year.
• Such a revision to the Q3 point would be an acknowledgement from the Board that the risk of a hike to 2% is marginally greater than the risk of another cut in H2 2026. However, we don’t expect this to provide a meaningful hawkish impulse to markets, which have moved to almost fully price in a hike by the end of 2026 over the past few weeks.
• Instead, the risk to market pricing is probably skewed in a dovish direction, in a scenario where the Board holds the first three quarters of the path at 1.75%. We note that this scenario is the current consensus amongst analysts, even if not endorsed by SEK rates markets.