Riksbank's Ohlsson: Negative rates can lead to build-up of financial risks

Eren Sengezer FXStreet

Negative rates shouldn't be used unless it's absolutely necessary as they can lead to a build-up of financial risks, Swedish central bank (Riksbank) Deputy Governor Henry Ohlsson argued on Friday while speaking to reporters at a conference in Stockholm.

"If there is a crisis, then we can make monetary policy more expansive but we need to look at the whole toolbox," Ohlsson added. "I don't think that the monetary policy should react to changes of tenths of percentage points one way or the other."

EUR/SEK reaction

The EUR/SEK pair edged slightly lower following these comments and was last seen trading at 10.5691, down 0.1% on the day.

Author

Eren Sengezer

FXStreet

As an economist at heart, Eren Sengezer specializes in the assessment of the short-term and long-term impacts of macroeconomic data, central bank policies and political developments on financial assets.

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