In Sweden, the week ahead is all about inflation (Tuesday, at 09:30 CEST). Our call is for CPI and CPIF inflation to come in at the Riksbank's forecast but for core measures (e.g. CPIF excluding energy) to come in lower.
In a client seminar last week arranged by Danske Bank Sweden, Riksbank deputy governor Cecilia Skingsley elaborated on her views on future monetary policy. As she has previously said, she cannot exclude additional monetary stimulus but, unlike in the past couple of years, in order for her to vote for further stimulus, more substantial revisions of the outlook for growth and inflation are required. Hence, now much more uncertain if more QE will be added in Sweden next week.
In Norway, core inflation surprised on the upside in February, at 3.4% y/y after the weakening of the NOK in 2015. However, we expect price cuts on confectionery and other Easter-related goods to drag the annual rate of core inflation down to 3.2% in March.
In Denmark, CPI data for March are due to be released today. We expect the CPI to gain 0.4% m/m and 0.3% y/y. Although petrol and diesel prices climbed in March and food prices rose more than usual, this was probably not enough to push up the annual change in consumer prices given the relatively big monthly increase in March 2015.
We also take a closer look at the factors that have pushed EUR/DKK lower and how the Danish central bank will react if we see a new currency inflow into Denmark.
To read the entire report Please click on the Pdf File Below.