There is no evidence that asset purchases by the Swedish central bank from 2015 to 2022 had any substantial effect on inflation, and they will come with a very high cost for the state, the National Audit Office said on Wednesday.
In a bid to raise inflation, the Riksbank for years bought government and municipal bonds, corporate bonds and covered bonds. The holdings totalled 975 billion crowns ($93 billion) by the end of 2021 and with inflation now far higher, the Riksbank is selling the assets at a loss.
The National Audit Office, a parliamentary body which conducts independent audits of state finances, said that while the process had been transparent the Riksbank had underestimated the risks.
“We cannot see any support that the purchases affected inflation in a tangible way. At the same time, the costs of the purchases will be significant, which ultimately affects the state’s finances,” it said in a report.
The Riksbank in a separate statement said parliament’s finance committee will now examine the report, and that the central bank itself will comment on the report at the start of next year.
The aim of the bond purchases was to maintain confidence in the inflation target, secure credit supply during the pandemic and contribute to good economic development.
The Audit Office estimated the losses from the operation to 61 billion crowns and issued the advice that asset purchases primarily aimed at influencing inflation be avoided in future.
The Riksbank has said it needs around 80 billion crowns from state coffers to restore its equity.
($1 = 10.4811 Swedish crowns)
Reporting by Johan Ahlander, additional reporting by Anna Ringstrom; editing by Niklas Pollard and Terje Solsvik
