Swedish economy strong, but no rate hike until late 2018

Sweden's underlying inflation remains sluggish, despite stronger than expected economic growth, and the central bank will have to postpone its first interest rate hike in nearly six years until late 2018, an economic think-tank said on Wednesday. The Riksbank has cut interest rates deep into negative territory and introduced an extensive bond buying programme in order to lift prices.
In February, inflation hit the central bank target for first time since late 2010. But the Riksbank itself has cautioned price increases have yet to stabilise and the National Institute of Economic Research said weak inflation will continue to be a worry over the coming years despite strong economic growth. "The Riksbank will therefore wait before raising the repo rate, with a first hike not expected until the third quarter of 2018," the NIER said.