Riksbank deputy: inflation is bad for jobs
TT/The Local - [email protected]
Published: 12 May, 2006 CET.Updated: Fri 12 May 2006 17:23 CET
Letting inflation rise is no way to reduce unemployment. That was the message from the deputy governor of Sweden's central bank in a speech to trade unionists on Friday. Talking to LO members in Västerås, 100km west of Stockholm, the Riksbank's Kristina Persson hit back at unions' criticism of interest rate policy.
The Riksbank has raised interest rates twice this year, from 1.5 to 2 percent.
Both rises have been slammed by LO chairman Wanja Lundby-Wedin and leading Social Democrats including party secretary Marita Ulvskog. Göran Persson himself has questioned the rate rises.
Hitting back at critics, Kristina Persson said lower unemployment could not be bought with higher inflation.
"I argue that the reverse is true: stable prices give the economy a good base to stand on," she said.
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Talking to LO members in Västerås, 100km west of Stockholm, the Riksbank's Kristina Persson hit back at unions' criticism of interest rate policy.
The Riksbank has raised interest rates twice this year, from 1.5 to 2 percent.
Both rises have been slammed by LO chairman Wanja Lundby-Wedin and leading Social Democrats including party secretary Marita Ulvskog. Göran Persson himself has questioned the rate rises.
Hitting back at critics, Kristina Persson said lower unemployment could not be bought with higher inflation.
"I argue that the reverse is true: stable prices give the economy a good base to stand on," she said.
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