When the Riksbank lowered Sweden's policy rate to 3.50 percent, it indicated the possibility of cutting it two to three more times, leaning towards three cuts.
Critics noted that the Riksbank only reduced the policy rate by 0.25 percentage points, suggesting a more aggressive reduction might have been warranted given economic conditions.
Thedeen stressed the importance of proceeding with caution in monetary policy, due to the unpredictable nature of geopolitical instability and global economic challenges.
The policy rate is crucial as it influences the interest rates Swedish banks charge, impacting borrowing costs, spending behaviors, and ultimately inflation rates.
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