December 19, 2019 / 10:53 AM / a month ago

Swedish central bank governor Ingves says zero rate is not a floor

FILE PHOTO: Sweden's central bank governor and Chairman of the Basel Committee on Banking Supervision Stefan Ingves gestures as he attends a news conference at the ECB headquarters in Frankfurt, Germany, December 7, 2017. REUTERS/Ralph Orlowski

STOCKHOLM (Reuters) - Sweden’s central bank could go back to negative rates if necessary, Governor Stefan Ingves said on Thursday after the Riksbank hiked to zero from -0.25%, ending five years of sub-zero benchmark rates.

“Zero isn’t a floor for interest rates. It is the rate that is the most appropriate at the moment,” Ingves told reporters.

“If we need to, we can have periods ... with negative rates, but that’s a hypothetical question and not anything we see ahead of us given our view of the development of the economy.”

Reporting by Simon Johnson; Editing by Alison Williams

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