Swedish Central Bank Chief Says Data Key to April Rate Decision as Uncertainty Mounts

Sweden's central bank still expects to hike rates by a quarter or half percentage point in April, but market turbulence in the United States means incoming data will be decisive for policy, Riksbank Governor Erik Thedeen said on Tuesday, Reuters reported. The sudden collapse of Silicon Valley Bank and Signature Bank pressured global bank stocks further on Tuesday, following sharp losses on Monday, as investors fretted over the financial health of some lenders, despite assurances from U.S. President Joe Biden and other policymakers. The developments have ratcheted up uncertainty about how monetary policy will now develop worldwide. "We are following developments in the financial markets, and we currently consider there to be no risk to financial stability in Sweden," Thedeen said in a statement before giving testimony to parliament's finance committee. "At the same time, it is not unusual for turbulence in foreign capital markets to spill over into Sweden. We are therefore closely monitoring the situation and, as always, we are prepared to take action in the event of a rapid change." Thedeen said the impact might be felt in higher borrowing costs for companies or weaker developments in the stock market and across the wider economy. Read more.
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