Klart for rentethriller: – Kan komme to hevinger

The economic and market situation is in a precarious state, with roughly half of the respondents believing a rate hike is imminent, while the other half remains unconvinced. The Central Bank's Monetary Committee, led by governor Ida Wolden Bache, presents its decision on Thursday at 10 AM – stating that they are waiting for a rate hike.

Hov, chief economist at Handelsbanken, argues that the underlying price increase is still high, with core inflation consistently around 3% for about two years. While price increases have been lower than the Bank's expectations, they have recently recovered in August, as business expectations for wage growth remain high. Higher interest rate expectations abroad also push for higher rates at home, according to Hov.

If the Bank goes against the trend once more, it could impact the krone and make it tougher to bring down price increases. Markets anticipate a 62% chance of a hike on Thursday, with a possible second hike up to a 4.75% rate next year. Hov warns that a rate pause now does not mean the peak has been reached, and a pause would essentially be a decision to wait for further data.

If the Bank raises rates now, they may open the door for another increase. Hov believes people should consider that today's interest rate might be as high as it will go, and not base the economy on simple forecasts they hope for. The current mortgage loan's longevity is 20-30 years, and one must plan for a rate level that is not significantly lower than today in the long term.

Before the Bank's decision at 10 AM on Thursday, Sweden and Switzerland will release their rate decisions at 09:30 AM. Neighboring countries' expectations are not to raise rates, but Hov suggests that expectations for rate adjustments may increase over the year. The Bank recently raised rates in several countries, citing energy prices due to the conflict in the Middle East and efforts to prevent inflation from spreading too far into the economy.

However, Hov points out that inflation problems in the Bank began before the conflict between the USA and Iran, and highlights home-grown factors contributing to inflation and high wage growth as contributing factors.