Riksbank Surprises With 100 Bps Hike to 1.750%

The Riksbank of Sweden announced a larger-than-expected rate hike to 1.75%, surprising market participants who anticipated a rise to 1.5%. This move led to a gain in the Swedish krona against the euro. The Riksbank's decision is part of a broader trend among G10 central banks to implement significant rate hikes, a strategy typically seen in emerging markets. This trend is influenced by pressures from larger central banks like the Fed, which is considering further rate increases. Markets are now adjusting their expectations for future rate changes, with the Fed's peak rate anticipated to reach 4.5% by early next year before declining.

What was the unexpected rate hike announced by the Riksbank?

How does the recent rate hike by the Riksbank compare to previous hikes in the last three decades?

What factors contributed to the Riksbank's decision to raise the interest rate?

What impact might the Riksbank's decision have on the Federal Reserve's upcoming rate decisions?

What is the expected trajectory of the Fed rate according to market pricing?