The Swedish central bank has cut its key interest rate by 0.5 percentage points to boost the Nordic country's economic growth.
The Riksbank on Thursday lowered the rate to 0.25 percent from 0.75 percent, saying inflation had been "lower than expected" and had not reached the target of 2 percent.
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It noted that economic activity in Sweden was improving and that the rate cut would "contribute to higher demand in the economy as a whole" and help Sweden reach the target inflation rate by early 2016.
The central bank said the growth in Sweden had been mainly visible in the strong household sector and that the weaker export industry was expected to show signs of recovery as "demand abroad picks up" later this year.