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2025-12-18 16:33:40
[With Interest Rate Cuts Nearing Their End, Markets Bet on Central Bank Roadmap; Where Lies the Disagreements?] ⑴ On Tuesday, the Swedish central bank released its latest policy rate forecast, indicating that it expects the key interest rate to remain stable at 1.75% in the first three quarters of 2026, consistent with previous forecasts. ⑵ According to its outlook, the average interest rate in the fourth quarter of 2026 is expected to be 1.77%, unchanged from previous forecasts, while the forecasts for the fourth quarters of 2027 and 2028 are 1.94% and 2.12%, respectively. ⑶ Notably, the Swedish central bank's forecast for the end of 2027 is slightly higher than the previous forecast of 1.92%, a slight upward revision suggesting a subtle adjustment in policymakers' assessment of the long-term interest rate path. ⑷ This series of data suggests that the widely anticipated interest rate cut cycle may be nearing its end, and the future policy path will be smoother and more uncertain. ⑸ For traders, the focus has shifted from "when to cut rates" to "what will the final interest rate be," and even small differences in central bank forecasts could trigger a repricing of market expectations for long-term liquidity. (6) In the future, we need to pay close attention to similar long-term forecasts from other major central banks, such as the European Central Bank or the Federal Reserve. Any signals of synchronization or divergence will be key to influencing global asset rotation.
