First interest rate hike in Sweden after more than three years

Sweden’s Riksbank raised its policy rate by 25 basis points to 2%, marking its first rate increase in more than three years. The central bank pointed to higher energy prices feeding through into inflation and signaled that further hikes could be on the table next year. The move matters because it ends a long stretch of unchanged policy in one of Europe’s smaller open economies and suggests policymakers are prioritizing inflation control over growth support. Investors will watch upcoming Swedish inflation prints and Riksbank commentary for confirmation of the expected tightening path.