In Sweden we get the January inflation data and there is always some uncertainty related to clothing this month due to sales, but there is also seasonal sales in furniture and electronic equipment, suggests Analyst, Jens Peter Sørensen at Danske Bank.
“Together this results in our expected CPIF m/m change at -0.7% (same as market). More, updates to the CPI basket could as always in January result in surprises. However, over the past few years such surprises have been rare or very small. The CPIF y/y is expected to be 1.9%, which is the same as both consensus and Riksbank’s updated projection.”
“Last week Riksbank expressed concerns over the inflation and especially the recent move lower in service inflation. In fact, Riksbank was, in our view, close to shifting the rate path, i.e. postponing the first rate hike. A lower-than-expected inflation reading today, driven by lower service inflation, could move the market a bit, sending interest rates in shorter maturities lower, since market’s implied repo rate path is close to, or a tad above, the Riksbank’s path.”