Sweden Surprise Inflation Drop Backs Rate Pause, Dents Krona

Sweden’s core inflation unexpectedly eased to its slowest pace in more than four years, triggering a weakening of the currency as investors pared expectations for interest-rate hikes from the Riksbank.

The CPIF inflation rate excluding energy declined to 1.1% in March, its lowest since July 2021, according to a preliminary release from Statistics Sweden on Tuesday. The median forecast in a Bloomberg survey of analysts was 1.5%, the same as the Riksbank’s projection.