Riksbank Cuts Rates in Surprise Move to Bolster Economy

Sweden’s central bank unexpectedly cut its policy rate by 25 basis points to 1.75% at its September meeting, defying market expectations for a hold. Policymakers said the decision aims to support economic activity and bring inflation back to target over the medium term. The Riksbank noted that conditions for stronger growth remain in place, with recent data offering reassurance that elevated inflation is likely transitory. Still, officials highlighted persistent risks from geopolitical tensions and uncertain US trade policy, which could alter the future path of monetary policy. For now, the central bank signaled that if its inflation and growth outlook holds, the policy rate is likely to stay at this level “for some time.”