Riksbank Delivers Surprise rate Hike

In a move that rattled markets, the Swedish central bank — the Riksbank- has raised its policy rate by 25 bps to 0.25%. The Nordic bank has gradually begun normalizing policy and will equally wind down its balance sheet by first cutting asset purchases in the Second half of the year. The interest rate hike will support the Swedish Krona (SEK) against the Euro even as the Swiss Franc will remain firmer as safe-haven flows persist amidst the Russia-Ukraine crisis. The Riksbank’s decision to reduce its net asset purchases will reduce liquidity in financial markets and slow credit-driven growth…