monetary policy Per Jansson Riksdag Committee on Finance Deputy - PowerPoint PPT Presentation

My view on monetary policy Per Jansson Riksdag Committee on Finance Deputy Governor 24 September 2019

Unusual monetary policy in recent years Repo rate Purchases of government bonds 80 80 60 60 40 40 20 20 0 0 Per cent and SEK billions, nominal amounts respectively. Source: The Riksbank

The policy has improved the inflation picture significantly Inflation Inflation expectations Annual percentage change and per cent, mean value. The dot marks the Sources: TNS Sifo Prospera and Statistics Sweden outcome since the Monetary Policy Report in September. Inflation expectations among money market participants.

And also contributed to good development in the real economy GDP growth Employment and labour force 85 85 8 8 TUR 6 6 IRL 80 80 4 4 EST KOR GDP NZL 75 75 SWE AUS USA CAN GBR 2 2 CHE DEU OECD AUT NOR NLD DNK BEL JPN EMU FIN FRA Employment rate, Sweden ESP ITA 70 70 PRT Labour force participation, Sweden 0 0 OECD countries OECD countries -2 -2 65 65 -2 0 2 4 6 01 05 09 13 17 GDP per capita Average growth rate in GDP and GDP per capita 2010-2018, and employment Sources: OECD, Statistics Sweden and the Riksbank. and labour force participation as a percentage of the working-age population respectively. In Sweden, measures for the working-age population aged 16-64 years are used and aged 15-64 years for OECD countries.

Poorer sentiment and lower interest rates in 2019 10-year government bonds Clear decline in industry Per cent and annual percentage change respectively. Yields on 10-year Sources: Institute for Supply Management, Markit and Macrobond government bonds. The vertical lines indicate the monetary policy meetings in April, July and September. Purchasing managers' index in the manufacturing sector.

Low interest rates supporting economic activity and inflation Hesitant about increasing the rate around the turn of the year - Inflation quite low in the near term (even prior to the August outcome) - Worrying development tendency for inflation expectations - No appreciable upside risks - The Riksbank and leading central banks going in different directions; what does this mean? But still not entering a reservation at this time - Increase not decided, a forecast (that is uncertain) - Rate path is otherwise reasonable Per cent. Source: The Riksbank