PARIS (MNI) – Sweden’s central bank, the Riksbank, announced
Tuesday that it has decided to reduce its repo rate by 25 basis points
to 1.75% because of a darker economic outlook both home and abroad, and
low inflation.

The decision was split, with deputy governors Karolina Ekholm and
Lars E.O. Svensson dissenting. They both argued for a larger rate cut of
50 basis points to 1.5%. They also wanted the bank to project a lower
repo rate path than was decided.

“The economic outlook abroad has deteriorated and the Swedish
economy is slowing down. At the same time, inflationary pressures are
low,” the Riksbank said in a written statement announcing its decision.
“The Executive Board of the Riksbank has therefore decided to cut the
repo rate by 0.25 percentage points to 1.75 per cent and to lower the
repo-rate path.”

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