The good ship SNB set to maintain its course

This morning’s decision by the Swiss National Bank to keep its policy settings unchanged came as no surprise. The prospect of further falls in the franc should allow the Bank to largely stay out of the FX market, but the policy rate will remain rooted at a record low of -0.75% for the foreseeable future.
David Oxley Senior Europe Economist
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Nordic & Swiss Economics Update

“QT” creeping up the agenda in Sweden

The Riksbank stuck firmly to “Plan A” this morning by maintaining the status quo for the repo rate and its asset purchase programme. However, the slight tweak to the Bank’s language on the outlook for the balance sheet lends support to our view that policymakers will allow it to shrink by the end of next year.

21 September 2021

Nordic & Swiss Economics Update

Switzerland and Nordics to sidestep gas price woes

The low use of gas, and a reliance on nuclear and renewables for electricity generation, means that Switzerland and the Nordics are less exposed to the recent surge in gas prices than other parts of Europe – particularly Spain.

20 September 2021

Nordic & Swiss Economics Weekly

Monetary policy decisions, served three ways

After months of anticipation, the Norges Bank will surely pull the trigger on its long-awaited tightening cycle next Thursday. We suspect that policymakers will portray the rate rise as a “dovish hike”, but we still forecast the Bank to raise rates by another 25bp in December, and by a bit more than investors expect next year. Elsewhere, both the Riksbank and SNB will leave their policy rates on hold next week, but we think there is a good chance that Swedish policymakers will open the door to shrinking the balance sheet next year.

17 September 2021

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Nordic & Swiss Data Response

Norway GDP (May) & Sweden GDP Indicator (May)

The larger-than-expected rise in mainland Norwegian GDP in May indicates that the economy is back in business following the lifting of restrictions, and it is likely to have regained its pre-virus level in June.

7 July 2021

Global Economics Focus

The CBDCs are coming

We expect some major central banks to issue digital currencies later this decade, with those in countries where cash is rarest proceeding the fastest. The first generation of central bank digital currencies will be purposely designed not to shake up the status quo. But once established they would offer powerful new policy tools. It would be naïve to think that sooner or later central banks won’t consider using them.

6 July 2021

Nordic & Swiss Economics Weekly

Löfven exits the stage (not pursued by a bear)

The resignation of Prime Minister Stefan Löfven in Sweden has added to the period of political uncertainty in Sweden. That said, the other leading political actors would probably struggle to pass muster in the Riksdag and so there is a good chance that Mr Löfven will return in the same role before long. Next week, we expect monthly GDP data from Norway to show that mainland activity gathered pace in May, and that core inflation remained below the Norges Bank’s target in June.

2 July 2021
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