“We estimate that the Riksbank will continue to underestimate inflation, and that the policy rate will be raised by 50 basis points in September, or that they will squeeze in an increase of 25 basis points already during the summer. This will be followed by 25 basis point increases at each subsequent meeting until February next year.” Andreas Wallström, head of forecasting at Swedbank, writes in a press release.
Swedbank now believes that the key interest rate will be 1.75 at the beginning of next year and that Swedish short-term interest rates will rise rapidly.
“The Riksbank’s progress means that we revise up our forecast for floating mortgage rates somewhat. We expect the floating interest rate to reach 3.1 per cent already in December. This means that the interest rate will more than double during the course of this year,” Wallström continues.