As before, the Riksbank will be publishing an inflation report four times a year, with a more comprehensive survey of inflationary pressure in the Swedish economy in the coming 24 months. 1  BIS Review 18/1999  The Executive Board held its first monetary policy meeting last Thursday and discussed inflation prospects. The Board then decided to lower the repo rate 0.25 percentage point and also lowered the corridor in which the repo rate lies by 0.5 percentage point. The Board’s decisions and the arguments behind them were published in a communiqué on Friday. Another feature of the new Riksbank organisation is that each member of the Executive Board has an individual mandate and one vote. All the members are in a position to make speeches and give interviews on monetary policy in which they express their own view of the situation. It follows that the members can hold different opinions and may also express themselves somewhat differently about joint positions. Today I shall base my remarks on the picture that was used for last week’s Executive Board discussion and summarised in the communiqué. When I elaborate on the communiqué it is my personal opinion I am expressing, though that does not mean that other Board members were not of broadly the same mind. Poorer international prospects In the course of last year, international economic prospects became a good deal worse.
Mr Heikensten looks at the current economic situation in Sweden Speech by the First Deputy Governor of Sveriges Riksbank, the Swedish central bank, Mr Lars Heikensten, to Forum ’99, the Swedish Federation of Rental Property Owners, in Stockholm on 15/02/99. I should like to begin with a word of thanks for the invitation to talk here today about economic developments, inflation and the interest rate. Before taking a look at the current economic situation and saying something about our deliberations in the Riksbank, however, I feel there may be grounds for adopting a somewhat broader perspective and even for striking a slightly optimistic note. Sweden certainly has economic problems; further measures are needed, not least to improve the conditions for growth. But at times it may also be fitting to recall the things that have turned out well. Swedish economic policy was realigned in the early 1990s with the aim of establishing a regime of low inflation. Previously, Sweden had had a long tradition in this respect but in the 1970s and 80s the accepted truths were discarded, including the idea that low inflation provides a good foundation for growth and employment. Following the collapse of the Bretton Woods system, stabilisation policy no longer offered any hard and fast rules. Sweden’s external debt – both government debt and the total stock – was allowed to grow at a dramatic rate, accompanied by spiralling prices and wages. Today, Sweden is in the sixth successive year of good economic growth.