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According to TD Securities analysts, after the Riksbank left its policy rate projections little changed in July, they think that the rate forecasts are due for some sharp downward revisions.

Key Quotes

“While Sweden’s manufacturing sector has held up better than its European counterparts, its extremely vulnerable to some substantial catch-up to the downside, plus we’ve seen real weakness in both the labour market and inflation expectations.”

“We see about a 30% chance that the Riksbank moves toward an easing bias at today’s meeting, and close to a 50% chance of a rate cut around the turn of the year.”