The reason I  8  BIS central bankers’ speeches  am returning to this forecast is that I don’t think anyone would question that the National Institute of Economic Research is a serious and competent forecaster – and it can scarcely be accused of deliberately spreading “misleading pictures of the future”. And as I said, the National Institute of Economic Research’s forecasts were not in any way unique, but reflected well how forecasters in general viewed the situation. Anyone who claims to have predicted the current low inflation back when the repo rate increases began in 2010 must thus have had much greater insight than all of the Swedish and international analysts. I would rather argue that this instead is a good illustration of the fact that things have happened in the economy, which could not be predicted and which have pushed down inflation in an unexpected manner. Unexpected international economic slowdown in 2011 and even lower inflation in 2013–2014 I would like to give examples of two occasions in recent years when developments have turned out rather differently than expected. The first is the slowdown in international economic activity that became apparent during the second half of 2011. Global growth prospects deteriorated in connection with increased unease over the sovereign debt problems in the United States and euro area. Uncertainty over the future led to increased pessimism among households and companies and also affected the financial markets.
Basing an analysis on such an assumption is therefore not a reasonable way of evaluating the advantages and disadvantages of leaning against the wind. One needs to assume not just that the Riksbank has lied about its motives, but also that well-known and prominent external economic analysts have said one thing but really meant another. Nevertheless, this is the starting point for the counterfactual analysis many appear to rely on when drawing conclusions about the Riksbank’s monetary policy.8 In Sweden, this analysis has been given considerable scope, for instance on Dagens Nyheter newspaper’s editorial pages, where the Riksbank’s policy has been described as more or less incomprehensible and contrary to the prevailing opinion at that time – an ”interest-rate increasing experiment in summer 2010”.9 One might think it is strange that the claim that the Riksbank’s repo-rate increases were only about leaning against the wind, and moreover that the increases were made contrary to prevailing opinion, has become so widely spread. After all, one does not need to make a more in-depth check of the facts than I have provided here to see that neither claim is correct. It doesn’t require very much digging to be able to conclude that not only the Riksbank but also external domestic and international economic analysts found it natural, even after the repo rate had been raised to 2 per cent, that the increases would continue – and this without any particular reference to household debt.