Wed. Jan 27th, 2021

Bank of England admits hedge fund hack ahead of interest rate decision – business live

Rolling coverage of the latest economic and financial news

8.59am GMT

Sweden’s interest rate rise is a small but significant milestone as central bankers try to extricate themselves from a decade of loose monetary policy.

Significantly, the Riksbank is ending negative interest rates while still continuing its asset-purchase programme (buying bonds with new money to stimulate growth).

Riksbank hike rates to 0% to end period of sub-zero rates while maintaining government bond purchases – different to the ECB that sees the APP as the marginal policy tool when tightening. RB seem negative consequences of sub-zero rates too detrimental to maintain the current [1]

stance, and with the latest inflation reports suggesting CPIF is returning to the 2% target they have decided to strike now. Notable dissent on the decision from Deputies Breman and Jansson – former suggested the hike to come in H1 2020. [2]

Forward guidance of the repo rate suggests 0% is here to stay over the coming years, however. Risks remain in the current global climate for another cut but the nature of this hike suggests the threshold to re-enter negative territory is much higher than previous. [3]

8.39am GMT

Newsflash: Sweden’s central bank has raised interest rates, to the heady heights of ZERO!

#Sweden ends Sub-ZERO experiment: Riksbank raises repo rate to 0.0% from -0.25%.

I see the Riksbank have gone back to 0% interest rates as expected. Sensible.

Pacing through their presentation I see the below chart covers most of the potential future outcomes out there!!

(via )

Continue reading…

Leave a Reply

Your email address will not be published. Required fields are marked *