It was therefore sometimes perceived as unclear which expectations we meant when we commented on whether market expectations were reasonable. This gave rise to some criticism for unclear communication in 2005 and 2006. Using our own forecast for the repo rate removes the risk of being misunderstood for this reason. Experiences so far of our own interest rate path My impression is that the comments on the new system of publishing our own path for the repo rate have largely been positive, although there has also been some criticism. With regard to our concrete forecasts for the repo rate, the discussion has become livelier and we have heard more criticism. On the two occasions so far when we have presented a new assessment the monetary policy decision to raise the interest rate to 0.25 percentage points has indeed been anticipated and hardly been questioned. But our forecasts regarding future developments have surprised some market agents. 2  BIS Review 112/2007  The Riksbank’s forecast was a surprise in February The path for the repo rate that we presented in February was lower than the expectations that could be detected in the market pricing at that time. It was also lower than the average of the interest rate forecasts made by other forecasters. However, there were considerable differences between the different market analysts. Some had views relatively close to ours, while others differed substantially.
A higher repo rate with then be needed in order to keep inflation close to the target. Conclusion Today I have spoken about the situation in Sweden and abroad: partly about our dependence on events abroad and partly about what we ourselves can do to smooth the course of development in the Swedish economy. I have previously described the crisis in the early 1990s like this: “Things were quite OK abroad, but Sweden was not OK”. At the time of the crisis in 2008 the situation was the opposite: “Things were not OK abroad, but Sweden was OK”. Recent developments abroad have been marked by great uncertainty. Sweden is highly affected by this uncertainty. With the help of monetary policy we can do all that we can to promote a stable development of the Swedish economy: that is ensure that inflation stays close to the target and that the development of the real economy is as stable as possible.