Swedish bank cuts key rate to record minus 0.1 pct, stimulates growth with bond-buying plan

Markets Associated Press

Sweden's central bank has cut its key interest rate to a record low -0.1 percent and launched a program of government bond purchases worth 10 billion kronor ($1.2 billion) to stimulate the economy.

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The Riksbank on Thursday lowered the key interest from 0 percent, in the first change since October, saying there is a risk that inflation, which it believes has reached its lowest point, will not rise fast enough.

The bank warned that although it expects the global economic recovery to continue in the years ahead, it will be at a "slow rate." It added that growth in Sweden will benefit from low oil prices, a weaker krona and low interest rates.

The Riksbank joins a growing number of central banks who are lowering rates to bring inflation higher.