Apr

14

From the "dog chasing its tail-department,"  it is interesting to note that the Riksbank changed the measurement of inflation that they base their policy on a while ago. The measurement they are focusing on now includes cost of credit in a way that includes their own rate-lowering effect. So the more they lower the rate, the lower the inflation and the more they need to lower the rate if they are to keep with their policies. They used to follow a measure which took into account this effect, but not anymore. This is also one of the reasons that they kept raising rates until September last year.


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