The Swedish central bank set a zero base interest rate on Tuesday, deciding to cut its key rate by a quarter of a percentage point in a drive to push up exceptionally low inflation.
This is a record low and the central bank said it would stay at this rate until inflation picks up.
Inflation was too low, the bank said in a statement, although the Swedish economy was doing relatively well and the overall climate was improving.
It expects inflation this year to turn out to be a negative 0.2 percent, pointing to slight deflation, but that next year it will rise to plus 0.4 percent.
The rate cut was steeper than analysts had expected. They had forecast a cut of 0.20 points.
The bank said that this new low rate should increase demand in the economy and that this in turn would help to push up prices and inflation.
In September, consumer prices fell by 0.4 percent, far below the central bank’s target for inflation of 2.0 percent which has not been achieved since the beginning of 2012.
The latest inflation figure also showed a bigger drop than analysts had expected.
In seven of the first nine months of the year, inflation has been negative, meaning that prices fell.
This is against a broader background of deep concern in many European economies, notably in the eurozone, that there is a risk of deflation, a vicious cycle of falling prices, demand, and growth and rising unemployment, which central banks find extremely difficult to reverse.
Sweden is a member of the European Union but not of the eurozone and so retains control, via its central bank, of monetary policy and interest rates.
The central bank forecast that the unemployment rate would be 7.9 percent for this year, slightly down from 8.0 percent last year, and that next year the economy will grow by 2.7 percent and the unemployment rate will fall to 7.4 percent.
Michael Flynn’s legal team is making bizarre moves — signaling he’s still hoping for a Trump pardon
When disgraced former National Security Adviser Michael Flynn recently hired a new firebrand lawyer, Sidney Powell, it suggested he could be maneuvering to change his legal strategy.
And on Monday, new signs emerged that his legal team is looking to shake things up. Flynn had another status hearing on Monday before Judge Emmet Sullivan as he awaits sentencing for charges brought by former Special Counsel Robert Mueller.
In the hearing on Monday, Powell, who had been publicly critical of the Russia investigation before joining Flynn’s team, requested a security clearance to review documents in the case. This was a surprising move, because the government said that there was no classified information in the documents it had turned over to the defense.
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Republican political consultant Carter Ballmann received a five-year prison sentence on Monday.
"A former state legislative aide will spend five years in prison for trying to elicit sex from someone he thought was a 14-year-old girl, but was actually an undercover detective," the Columbia Tribune reported. "U.S. District Judge Roseann Ketchmark on Friday sentenced 25-year-old Carter Clinton Ballmann to five years in the Federal Bureau of Prisons on a single count of attempted receipt of child pornography."
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"Let me ask you, though, Ben, in this environment, we're now looking at the lowest unemployment rate for black Americans in the history of the United States of America under none other than President Trump," said Regan. "Is any of that loyalty starting to shift? I mean, are traditional black Democrats saying, hey, maybe the Democratic Party has failed me? Maybe I need to rethink this?"