The Swedish krona strengthened against both the dollar (8 penny) and the euro (9 penny) on the foreign exchange market and the Swedish bond yields rising after the announcement that gdp growth in sweden increased more than expected in the second quarter, 1.7 per cent. Compared with the second quarter of 2016, GDP increased 4.0 percent. Expected, according to SME direkt was 1.0 compared with the previous quarter and 3.0 compared with the second quarter of the previous year.
”It is jättestarka figures, but it is driven by household consumption and investment, particularly related to the housing market. Thus, it is räntekänsliga components driver. In the midst of all the euphoria one may therefore raise a warning finger and ask themselves how it would look if interest rates remained a percentage point higher. Then we would be able to get a totally different development,” said Michael Grahn, chief economist at Danske Bank in Sweden.
”The riksbank will, of course, to welcome the strong growth, but monetary policy is still dependent on inflation outcomes and the ECB,” he continues.
The interest rate on the Swedish ten-step 5 points to reach 0.70 per cent.