Sources: The OECD and the World Bank WDI  Figure 6 Unemployment and labour force in Sweden and the USA Percentage of labour force and percentage of population 16  74  14  72  12  70  10  68  8  66  6  64  4  62 United States, Unemployment (left scale) Sweden, Unemployment (left scale) United States, Labour Force (right scale) Sweden, Labour Force (right scale)  2 0 06  07  08  09  10  60 58 11  12  13  14  Note. Refers to 15–74 age group. Seasonally-adjusted data. Sources: Eurostat and the OECD  16  BIS central bankers’ speeches  Figure 7 Forecasts 2011–2012 for export increase 2012 Annual percentage change, annual average 8  Exports, actual outcome 2012  8  Other analysts The Riksbank  6  6  4  4  2  2  0  0  -2 jan-11  -2 jul-11  jan-12  jul-12  Sources: Respective forecasters (6 of them), Statistics Sweden and the Riksbank  Figure 8 CPIF and trend in unit labour costs Annual percentage change 4  4 Unit labour cost, trend CPIF  3  3  2  2  1  1  0  0 00  02  04  06  08  10  12  14  Note. The trend is calculated using an HP-filter (=1600) on a series extended with the Riksbank’s forecast.
Nevertheless, much of the criticism has been based on this assumption, for instance, the claim that the Riksbank’s policy of leaning against the wind after the crisis has cost 60,000 jobs. As I have shown, the general view among forecasters at the time when the repo rate had been raised to 2 per cent was that it would be necessary to continue to raise the repo rate – and for traditional monetary policy reasons. The increase from 0.25 to 2 per cent was thus not perceived as particularly remarkable or as purely justified by concern for household debt. I also hope I have convinced you that the low inflation rate in Sweden today does not reflect an economy that has developed very poorly since the crisis as a result of misguided, tight monetary policy. On the contrary, the Swedish economy has developed relatively well and has definitely not been in a state of deflation driven by a weak real economy. The main focus for the monetary policy conducted after the crisis has been to support the recovery and bring inflation back towards the target. Giving consideration to the risks linked to developments in household debt and housing prices has been part of the assessment but has not played a major role. The fact that inflation has been low is to a large degree, as always, a reflection of events over the course of time that have been difficult to predict.