Finance
Swedish central bank keeps rates on hold at 1.75%, sees no change ahead
Published by Global Banking and Finance Review
Posted on January 29, 2026
2 min readLast updated: January 29, 2026
Quick Summary
Sweden's central bank maintains its interest rate at 1.75%, with no changes expected for the year, amid balanced economic conditions.
Swedish Central Bank Maintains Interest Rate at 1.75% with Stable Outlook
Swedish Central Bank's Monetary Policy
By Simon Johnson
Current Economic Conditions
STOCKHOLM, Jan 29 (Reuters) - Sweden's central bank kept its key interest rate at 1.75% on Thursday as widely expected and repeated its forecast that no change was likely for the rest of the year.
Future Rate Expectations
The central bank has been enjoying a rare "Goldilocks" moment where the economy is growing and inflation is close to the 2% target.
Inflation and Growth Outlook
The Riksbank's main scenario is that the current benign conditions will continue and that the policy rate will be unchanged "for some time to come."
Nevertheless the outlook is finely balanced.
Geopolitical tensions are running high, growth could disappoint and inflation undershoot. But if the global picture brightens, GDP growth may accelerate.
"The uncertainty regarding the outlook for inflation and economic activity has increased," the Riksbank said in a statement.
"The Riksbank is vigilant with regard to developments and is prepared to adjust monetary policy if the outlook changes."
The Riksbank has cut rates eight times since spring 2024, most recently in September last year, in an effort to get wary consumers to start spending.
The economy has started to pick up and the government expects GDP growth of around 3.0% this year after 1.0% in 2025.
After being elevated through most of 2025, however, inflation is expected to cool, dropping well below the central bank's 2% target.
Analysts' main scenario is for no change in the policy rate until early 2027, when they expect a hike. However, another rate cut has not been completely ruled out.
"There are some tentative signs that the Riksbank ... is starting to see risks that inflation is becoming too low," Nordea economist Torbjorn Isaksson said in a note.
"We expect the Riksbank to stay on hold at 1.75% in 2026, with risks clearly tilted to a rate cut."
Capital Economics said the Riksbank would hike the policy rate in December this year.
The central bank will announce its next policy decision on March 19.
(Reporting by Simon Johnson and Niklas Pollard in Stockholm; Editing by Terje Solsvik, Alexandra Hudson)
Key Takeaways
- •Swedish central bank keeps interest rate at 1.75%.
- •No rate changes expected for the rest of the year.
- •Economy growing with inflation near 2% target.
- •Potential for rate cut if inflation risks increase.
- •Next policy decision announcement on March 19.
Frequently Asked Questions about Swedish central bank keeps rates on hold at 1.75%, sees no change ahead
1What is a central bank?
A central bank is a financial institution that manages a country's currency, money supply, and interest rates. It oversees monetary policy and regulates the banking system.
2What is inflation?
Inflation is the rate at which the general level of prices for goods and services rises, eroding purchasing power. Central banks aim to control inflation to maintain economic stability.
3What is GDP?
Gross Domestic Product (GDP) measures the total economic output of a country. It reflects the value of all finished goods and services produced within a country's borders in a specific time period.
4What are interest rates?
Interest rates are the cost of borrowing money or the return on savings, expressed as a percentage. They are influenced by central bank policies and economic conditions.
5What is monetary policy?
Monetary policy refers to the actions taken by a central bank to manage the money supply and interest rates to achieve macroeconomic objectives such as controlling inflation and stabilizing currency.