The Swedish Riksbank has gone from being the best among its peers in 2008 and 2009 at forecasting inflation to lagging behind its peers in two-thirds of the predictions, writes Bloomberg after comparing forecasts by six central banks between 2008 and 2013. The Riksbank’s errors can be traced back to 2010 when Governor Stefan Ingves raised rates despite Europe being in the midst of the worst economic crisis since WWII, states Bloomberg.
Appearing before the Committee on Finance yesterday, Riksbank Governor Stefan Ingves tried to pour oil on troubled waters when he said a strong krona was unwelcome news in the current situation. Afterwards, he told the media that it would be helpful if the krona remained at current levels, in terms of bringing up inflation to the 2 per cent target.
Ingves also said the central bank was prepared to take further measures, although currency intervention was not his first choice.
IT Minister Mehmet Kaplan’s dream is that 90 per cent of Swedish households will have 100 Mbit/s access by 2020. Estimates suggest his plans could cost up to 40 billion kronor to realise.
In a move to reduce the cost, Kaplan proposes that broadband operators should be bound by law to open up their infrastructure to competitors wishing to expand in the same region.
Kaplan also proposes that the Swedish Post and Telecom Agency be given the powers to decide disputes regarding cables and land.
His plans will now be circulated for comment, after which the minister hopes the legislation will come into force on 1 July 2016.
The Silf/Swedbank Swedish Services Purchasing Managers’ Index (PMI) slipped to 56.7 in February from 57.9 in January, which had been expected. The business volumes sub-index rose while all other sub-indices fell.
Plans by the Swedish Post and Telecom Authority (PTS) to ensure telecom service providers provide continuity of service in the event of a power outage have infuriated the industry. TeliaSonera claims that back-up solutions would cost the operator hundreds of millions of kronor to put in place, while estimates suggest that Tele2 would have to invest half a billion kronor to provide such resilience.
Employer organisation the Swedish IT and Telecom Industries estimates the industry would need to invest two billion kronor in order to meet the criteria.
Late Tuesday evening, the airline Norwegian said it was cancelling all domestic flights in Sweden, Norway and Denmark because of the pilot strike. More than 35,000 passengers will be affected.
The airline has also cancelled all flights between the Scandinavian capitals. Some flights to European destinations may also be affected. Long-haul flights to the US and Thailand will operate as normal.
Norwegian has said it will lay off 800 flight attendants as of today, Wednesday.
The Swedish economy will grow at a faster pace than many have forecast, says the multinational investment banking firm Goldman Sachs, predicting “solid” economic growth of 2.9% this year and 3.6% in 2016. Falling oil prices and the sharp depreciation in the krona favour an industrialised, exporting country such as Sweden, argues the firm.
Ulf Kristersson, the Moderates’ spokesman on economic policy, is against the government’s plans to remove the budget surplus target of 1% over a business cycle, saying such a move would impair Sweden’s ability to pursue an active fiscal policy during a financial crisis. He also warns that a deficit could build up very quickly, if the target is abolished.