ABBA redux; Swiss government spending splurge

The news this week that ABBA are re-forming chimes with the current up-beat mood about the Swedish economy . While we doubt that the Riksbank will be in a rush to raise the repo rate, we expect it to begin shrinking its balance sheet by the end of next year. Next week, July activity and GDP data from Sweden and Norway respectively will probably show that growth eased a bit at the start of Q3. Meanwhile, Norwegian inflation will have remained well below target in August, but this with not deter the Norges Bank from raising interest rates later this month.