The Riksbank's activities 2015: Continued expansionary monetary policy


In 2015, the Riksbank continued to conduct an expansionary monetary policy to support the positive development of the Swedish economy and to cause inflation to rise towards the target of 2 per cent. This is noted in the Riksbank's Annual Report for 2015, which has been submitted to the Riksdag (the Swedish parliament) today.

Growth in the Swedish economy was relatively good, despite the weak demand abroad. Consumption, housing investments and lower unemployment in Sweden contributed towards this development. Inflation, measured as the change in the consumer price index (CPI), amounted to 0.0 per cent as an annual average. If the effects of the Riksbank's repo rate cuts and the decrease in energy prices are excluded, inflation averaged 0.9 per cent measured in terms of the CPIF and 1.4 per cent measured in terms of the CPIF excluding energy.


"It is the Riksbank's task to safeguard price stability. We are doing this by conducting an expansionary monetary policy with a repo rate of –0.35 per cent and complementary purchases of Swedish nominal government bonds to amount to a total of SEK 200 billion by the end of the first six months of 2016. This monetary policy contributed towards the continued rise of CPIF inflation towards 2 per cent. A well-anchored inflation target makes it easier for households and companies to make well-founded economic decisions and lays the foundation for price-setting and wage formation", Governor Stefan Ingves said in his comments on the Riksbank's Annual Report 2015 (only in Swedish) .


Among other things, the Annual Report presents a review of the Riksbank's work on analysing risks that could build up in the financial system and threaten its stability. The Swedish financial system functioned well over the year, but the Riksbank considered that there were vulnerabilities in the structure of the Swedish banking system and risks linked to the globally-low interest rates. The low lending rates to Swedish households have also contributed towards housing prices having risen and towards indebtedness having increased among households. The Riksbank highlighted the risks of this and raised the need for the Riksdag, Government and other authorities to introduce various measures to restrain the development of household indebtedness.


In the Annual Report, the Riksbank also presents an assessment of the first stage of the changeover of Sweden's banknotes and coins, which took place in October, when the Riksbank introduced the new 20, 50 and 1,000-krona banknotes, as well as a new denomination, the 200-krona banknote. The introduction of the new banknotes has been smooth. Among other things, the distribution of banknotes to cash market agents has worked well and more than 90 per cent of the public were aware of the banknote introduction.


The Annual Report shows that the Riksbank's profit decreased by SEK 1.3 billion, to SEK 2.0 billion. This decrease is primarily due to write-downs related to the Riksbank's assets. The balance sheet total increased over the year by SEK 161.0 billion to SEK 663.4 billion, primarily due to the Riksbank's purchases of Swedish government bonds with the aim of making monetary policy more expansionary. These bond purchases contributed towards deposits from the banking system increasing by SEK 165 billion to SEK 214 billion.


The Riksbank's Annual Report for 2015 can be read as a parliamentary document in Swedish via the link below. English and Swedish versions of the Annual Report, in the Riksbank's standard layout, will be published at the start of April 2016, when it will be possible to download the report or order copies through this website.

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