Swedish central bank's Thedeen says inflation risks have increased, pointing to Middle East conflict

Riksbank Governor Erik Thedeen said the risk has risen somewhat that inflation could be higher than the central bank expected a few weeks ago. The comment is mildly hawkish and suggests a more cautious inflation outlook, but it contains no policy action or new data point. Market impact should be limited absent a clearer shift in Riksbank policy guidance.

Analysis

Riksbank Governor Erik Thedeen said the risk has risen somewhat that inflation could be higher than the central bank expected a few weeks ago. The comment is mildly hawkish and suggests a more cautious inflation outlook, but it contains no policy action or new data point. Market impact should be limited absent a clearer shift in Riksbank policy guidance.