Swedish Inflation turned out to be lower than expected


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Tuesday, 14 June 2011
Swedish consumer prices rose 0.2 percent in May from the month before, according to Statistics Sweden. Compared with the corresponding month of 2010 the consumer prices index (CPI) rose by 3.3 percent.

Analysts had anticipated that consumer prices would have risen by 0.2 percent on a monthly basis and rose by 3.4 percent compared to March 2010, according to various consensuses.

The central bank or the Riksbank's forecast from the Monetary Policy Update, published on 20 April, was that CPI would rise of 3.4 percent in May.

The overall rise in the CPI of 0.2 percent in the last month was blamed notably by higher housing costs (0.7 percent) by 0.2 percentage points. It helped increase mortgage interest owners (2.7 percent) by 0.1 percentage point. Otherwise, it was price increases for clothing and footwear (1.2 percent) and increased prices in the group dining and accommodation (1.0 percent), which contributed upwards by 0.1 percentage point each.


The increase was offset by lower prices for international air travel (-17.2 percent) and food (-0.4 percent), which contributed downwards with 0.1 percentage point each.

In April the consumer prices was 0.4 percent during the month, while inflation was measured at 3.3 percent.
CPIF (CPI with fixed interest rate) rose 0.1 percent in May from a month earlier and rose 1.7 percent in annualized terms.

Predictably, it was expected that there will be an increase of 1.8 percent in annualized terms according to expectations from forecasts. The Riksbank's forecast track pointed toward a rise of 1.8 percent in annualized terms even in May.

The underlying consumer prices, CPIX, were unchanged in May from the month before. Compared with a year earlier, prices rose 1.4 percent. HICP was unchanged in May, and rose by 1.7 percent from the same month last year.
By Team

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