Sweden: 2010 Article IV Consultation: Staff Report; Staff Supplement; Public Information Notice on the Executive Board Discussion; and Statement by the Executive Director for Sweden.
IMF Staff Country Reports, July 19, 2010
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- Sweden: 2010 Article IV Consultation: Staff Report; Staff Supplement; Public Information Notice on the Executive Board Discussion; and Statement by the Executive Director for Sweden.
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Bibliographic details
- Published: July 19, 2010
- Series: IMF Staff Country Reports
- DOI: https://doi.org/10.5089/9781455204601.002
Summary and key findings
- Sweden was among the first to falter in the great recession.
- The downturn was mitigated by aggressive stabilization policies, led by:
- a sharp relaxation of monetary policy,
- a slew of emergency financial sector support measures,
- actions raising bank capital.
- The policy actions were effective because they occurred against the background of:
- Sweden’s credible inflation targeting,
- a freely floating exchange rate,
- budgetary frameworks.
- The intention to keep policies supportive are appropriate.
- Fiscal policy anchors this effort, and the monetary stance is highly accommodative.
Macroeconomic context and policy response
- Immediate policy responses:
- sharp relaxation of monetary policy,
- emergency financial sector support measures,
- actions to raise bank capital.
- Structural and institutional backstops that supported effectiveness:
- credible inflation targeting,
- freely floating exchange rate,
- established budgetary frameworks.
- Policy stance:
- intention to keep policies supportive,
- fiscal policy serves as the anchor,
- monetary stance described as highly accommodative.
Subject tags and keywords
- Subject: Banking, Credit, Expenditure, Fiscal policy, Money, Output gap, Production, Public debt
- Keywords: Baltics, consultation discussion, consumer durables, CR, Credit, Europe, Global, inflation expectation, ISCR, labor market prospect, Output gap, staff appraisal, staff projection