Dan Lucas: the Rate of interest may very well be reduced

" Yes, it's been a long time since the announcement of this course of action was, as expected, like this one. Back in december, at the last meeting, the board finished with the repo rate would remain at zero for a number of years. It is the most solid at the moment.

" The increase in the rate of interest which took place in december, sek-0.25 to 0 per cent, it was criticised strongly by many economists to be wrong in the past. In autumn, the synthesis of the signs of a slowdown in the economy.

" if we are To believe the board's own forecast, as it will be until the end of 2022, when there will be a moderate increase. But the question is, how much you can trust the forecast. It may very well be a drop in the place, and it's earlier than 2022.

Therefore, the rate of inflation, according to the measure that the Riksbank is using, they don't end up in the bank's target of two per cent over the entire forecast period.

" the Board has lowered the forecast on inflation this year. In december, they counted on that it will be at 1.7 per cent – now it is reduced to the forecast of 1.3 percent. The board believes that it is the short-term effect of the exceptionally mild winter temperatures and lower oil prices have reduced energy prices.

Moreover, the executive board, in a press release that the global economy has slowed down, and the warning that coronavirus ”is expected to decline with the global growth in the short term.

" All of this suggests that we should not expect raising interest rates, rather the other way around.

" Actually, there is nothing on the basis of the ruling of the national bank. There have been no changes since december, more than forecast, inflation has been reduced. The repo rate had been the particular limited, in terms of the variable mortgage interest rates is unchanged, which means that they should not be changed for that reason.

"But it must be borne in mind that there are a lot of factors that affect mortgage interest rates, as banks' costs, and their margins, and the way in which competition develops.