November 8, 2019 / 8:32 AM / 3 months ago

Swedbank economist Breman named deputy governor of Swedish central bank

STOCKHOLM (Reuters) - The chief economist of Swedbank has been appointed deputy governor of the Swedish central bank, the general council of the Riksbank said on Friday.

Breman has been among those economists who believe that with interest rates negative and the central bank owning around half of outstanding government bonds, the Riksbank has little ammunition to use against any economic downturn.

She has consistently called on the government to do more to stimulate the economy, recommending that it invest to boost productivity and infrastructure.

Swedish government debt is at its lowest since the late 1970s, but the budgets of the Social Democrat and Green coalition have been only mildly expansionary in recent years. Finance Minister Magdalena Andersson argues that it’s better to save for a rainy day.

Breman has also warned about the dangers of a weak Swedish currency, partly a result of ultra-loose policy by the central bank. She says it could lead to increased foreign ownership of key Swedish industries.

She is also a strong advocate of integrating climate change into the thinking of politicians and central banks.

Breman has been appointed for a six-year term, beginning Dec. 1. She will take part in the monetary policy meeting on 18 December.

She will replace Kerstin af Jochnick, who left the Riksbank in September to take up a position on the board of the European Central Bank’s banking supervisory body.

Cecilia Skingsley, who also worked at Swedbank before joining the Riksbank’s rate-setting board, will become first deputy governor, effectively Governor Stefan Ingves’ second in command, the governing council said.

Reporting by Johan Ahlander and Simon Johnson; editing by Larry King

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