Swedish June inflation data is set to release tomorrow. According to a Nordea Bank research report, the CPIF inflation is likely to have accelerated to 0.5 percent year-on-year in the month from zero in May. The likely higher year-on-year data for June is because of higher energy prices. Excluding energy, CPIF is expected to have eased to 1.1 percent from May’s 1.2 percent on a year-on-year basis.
As for energy prices, both fuel prices and electricity prices rose in June. This is partially balanced by lower prices for distant heating, shaving off 0.04 percentage point of CPIF month-on-month. Food prices were roughly unchanged while there were some seasonal prices cuts on clothing and footwear, according to Nordea Bank’s forecast.
Statistics Sweden will continue to bring forward non-existing prices by using total CPI year-on-year.
“There have been many inflation surprises in recent months. Especially prices for services have been volatile and difficult to predict. This is a risk also for June, so be prepared for surprises. But while the monthly inflation readings are volatile, the overall picture is stable. That is, underlying inflationary pressures are low”, added Nordea Bank.
