The Sweden economy is in upward momentum in past four quarters, as the economy's average quarterly growth was 0.9%.

Various macroeconomic indicators have improved. The number of hours worked rose by 0.4% y/y in Q3 and productivity of the economy inched up to 3.5% y/y. This indicates a marginal increase in unit labor cost, hence, the country will have low inflationary pressure. Similarly, household consumption, fixed investment and exports posted a robust growth rate. 

"The stronger than expected growth makes it less certain that the Riksbank will take action at the December meeting. However, the probability for SEK appreciation is still looming. What measures the ECB will announce this week, and how markets will react on the ECB's moves, will be decisive for the Riksbank. For now, we stick to our view that the Riksbank will cut rates in December by 10bp to -0.45%, although it's a close call", says Nordea Bank.