Excerpts from the Statement by the Executive Board of the Riksbank:
Economic activity is strong and inflation is close to the target of 2 percent. Monetary policy needs to remain expansionary for inflation to continue to be close to 2 percent. The Executive Board of the Riksbank has therefore decided to hold the repo rate unchanged at −0.50 per cent and is expecting, as before, not to raise it until the middle of 2018. The purchases of government bonds will continue during the second half of 2017, as decided by the Executive Board in April. As the present asset purchase programme will run for the remainder of the year, it will provide an opportunity to await further information that could affect a decision in December to possibly extend the purchases. The Executive Board has also taken a decision to extend the mandate that facilitates a quick intervention on the foreign exchange market.
Developments since September have been in line with the Riksbank's forecasts both abroad and in Sweden. The international recovery is continuing, but global inflationary pressures are subdued and the level of interest rates is low. The normalisation of monetary policy abroad is expected to take time.
The Riksbank's monetary policy has contributed to economic activity in Sweden being strong. The employment rate is historically high. Inflation has risen and was 2.3 per cent in September. Above all, prices for services have increased rapidly, which reflects the way in which the strong economic activity is having a greater impact on the rate of price increases.