Sweden: Substantial extension of the QE programme – Nordea

The Riksbank has announced a substantial extension of the QE programme and unlimited liquidity support, analysts at Nordea report. EUR/SEK trades at 10.912.

Key quotes

“The Riksbank will buy additional SEK 300bn of bonds. The extended programme includes government bonds, local government bonds as well as covered bonds.”

“The repo rate is held unchanged at 0.0%, underlining that the Riksbank is reluctant to cut rates below zero. Rate cuts are unlikely also going forward, but can’t be ruled out completely.”

“These are tough measures that will help stabilise markets. Not least does it mean that the risk of rising mortgage rates is reduced, which is important for the housing market as well as for the outlook for domestic demand in general.”