Swedish central bank hikes rate 0.5 points to 3.5%

Sweden’s central bank has raised its policy rate by half a percentage point to 3.50 percent in line with market forecasts on Wednesday and said it was nearly done with policy tightening, according to CNBC.

Inflation, which came at 10.6 percent in March, “is still far too high and underlying inflation has been much higher than expected during the first months of the year,” the bank said it would likely raise the rate again in June or September.

The hike was in line with forecasts, while markets cut their expectations of where the Riksbank policy rate will peak to around 3.75 percent from close to 4.0 percent prior to the decision.

It is worth mentioning that the inflation in Sweden peaked in December at 12.3 percent, a more than 30-year high. It slowed slightly in January to 11.7 percent before unexpectedly spiking back to 12 percent in February.