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The Executive Board of the Riksbank usually holds seven or eight monetary policy meetings over the course of a year, at which it makes decisions regarding the repo rate. A Monetary Policy Report is published in connection with three of these meetings, containing the Riksbank’s overall view of the outlook for inflation and economic activity over the coming three years, based on the path for the repo rate that the Riksbank considers will provide a well-balanced monetary policy.
The work on producing a Monetary Policy Report begins in the Monetary Policy Department. First, the department draws up an internal document that contains its views on the inflation outlook. This document is then presented to the Executive Board and revised into a Monetary Policy Report.
The effects of monetary policy are exerted with some time lag, however. This is one reason why the Riksbank must adopt a forward-looking approach and base its decisions on a forecast of future inflation and economic activity. The
Riksbank tries to adjust the repo rate so that inflation is normally expected to be close to the inflation target of 2 per cent in a two-year time horizon. The two-year time horizon also provides scope for taking into consideration fluctuations in the real economy.
Approximately two weeks after a monetary policy meeting the Riksbank publishes the minutes, in which it is possible to follow the discussion that led to the actual interest rate decision. When the minutes have been published, the Board members may give speeches in which they explain the way they voted.
More information about the decision-making process, the factors that influence interest rate decisions, and how the Riksbank communicates, can be found under the links on the left-hand side of the page.