Riksbank minutes signal more easing, surprise Trump-victory unlikely to alter the view

Riksbank released minutes of the monetary policy meeting held on 26 October when members unanimously held rates on hold. The minutes showed that the Executive Board is concerned over the inflation outlook and that more easing measures are in the pipeline.

Most members seem prepared to extend the QE programme in December, while a rate cut is more dependent on events ahead of the December meeting. Inflation outcomes for October and November, the Fed and ECB are the most important events.

"The minutes had a slightly more hawkish tone than we had expected. We stick to our view that the repo rate will be cut by 10bp to -0.60% and that the purchase programme will be expanded by SEK 30bn in H1 2017 at the December meeting," said Norges Bank in a report.

The surprising Trump-victory has lowered the prospects for a December Fed hike, pushing global (short) rates lower. The prospects for more QE from the ECB are unchanged and the increased uncertainty on the economic outlook does not alter the view for more measures from the Riksbank being in the pipeline.