MNI Riksbank Preview Nov '24: Consensus Converges On 50bp Cut

EXECUTIVE SUMMARY

• A string of soft domestic activity data has shifted consensus towards a 50bp Riksbank cut in November to 2.75%, with markets tilted heavily towards that outcome.
• The door was opened to a 50bp cut in the September policy statement, which noted that rates would likely be cut in November and December “if the outlook for inflation and economic activity remains unchanged”, with a 50bp cut “possible at one of these meetings”.
• We think there is enough of a case for a 50bp cut to be delivered. The inflation outlook continues to appear consistent with the Riksbank’s 2% target, and growth concerns remain prevalent both domestically and in the Eurozone.
• The weak SEK presents the obvious case for a more cautious 25bp cut, which would be the most hawkish scenario for markets. Of the 16 analyst previews we have seen, only 1 looks for such a move.

FOR THE FULL PUBLICATION, SEE HERE: MNI Riksbank Preview - 2024-11.pdf