How could Sweden's success lead to deflation?Angus Walker
The moral of the Swedish story seems to be that central banks shouldn't rush to raise interest rates at the first signs of recovery. Faced with a housing bubble, Sweden’s central bank hiked rates from minus 0.25% to 2% in a short period of time. So is there a lesson for the ECB?
Saxo bank’s Head of Macro Strategy, Mads Koefoed, says that Sweden was right to raise rates when it did and thinks that the ECB case is very different to the Swedish example, despite pressure to take action to combat the threat of deflation in the Eurozone.