The Swedish central bank kept the key interest rates unchanged and obviously does not intend to hurry with tightening of the monetary policy. The regulator repeated its intentions to wait until mid-2018 before raising the interest rates. Currently, the main rate is -0.5% and it remained unchanged. The central bank, Sveriges Riksbank, did not give details of whether to continue with the bond purchase program in 2018.

“The recovery of the global economy continues, but global inflationary pressures are suppressed and the interest rates are low. The normalizing monetary policy abroad is expected to take time”, says the statement of the regulator.

Central bankers in Sweden are under pressure to start shrinking their large-scale quantitative easing program that has been in place for the past three years, supporting economic expansion and trying to boost inflation back to the target of 2%.

Sveriges Riksbank, however, is in a disadvantageous position because if it shrinks incentives before the ECB, it could lead to a rise in the Swedish krona, which in turn will slow down inflation. The governor Stefan Ingves said the bank does not want to take such measures before the ECB.

“As the asset purchasing program will continue until the end of the year, it will provide an opportunity to wait for further information that may affect the decision in December to eventually extend the incentives”, said the governor of Sveriges Riksbank. Experts also state that they remain committed to swift action on the foreign exchange market if such a need arises.