MNI Riksbank Review - Mar 25: Willing To Act If Needed

FOR THE FULL PUBLICATION PLEASE USE THE FOLLOWING LINK: MNI Riksbank Review - 2025-03.pdf

EXECUTIVE SUMMARY: 

• The Riksbank Executive Board unanimously voted to hold the policy rate at 2.25% in March, in line with expectations.
• The March MPR rate path was also essentially unchanged from Q2 onwards at 2.25%, the mid-point of the Riksbank’s 1.5-3.0% long-term nominal neutral rate estimated band. The unchanged rate path was in line with MNI’s expectations heading into the decision.
• Although the policy statement noted that rates will likely remain at current levels going forward, the policy statement and Governor Thedeen’s press conference highlights a willingness to act if the outlook for economic activity and inflation changes. 
• There was modest upside in EURSEK and NOKSEK following the decision, which may have reflected the removal of some hawkish tail risks related to the March MPR rate path and the relatively relaxed tone around recent inflationary pressures.