monetary policy in the prevailing recession. as monetary policy is forward - looking, it is important not to overlook the potential inflationary impulses now being built in for the future. price impulses from a weak krona and from high unit labour costs are two such factors. if the global economy recovers more quickly than we are predicting, this will also contribute to making monetary policy less expansionary. before further measures are taken, there are thus many reasons to evaluate the effects of all of the measures taken so far, and to evaluate the new information on economic activity and the financial market situation that is received. continued financial crisis difference between 3 - month interbank rate and expected policy rate ( basis spread ), basis points sweden euro area usa united kingdom jan / 07 apr / 07 jul / 07 oct / 07 jan / 08 apr / 08 jul / 08 oct / 08 jan / 09 apr / 09 economic downturn worsens in sweden gdp, quarterly changes in per cent calculated as annual rate, seasonally - adjusted data - 2 - 2 - 4 - 4 - 6 - 6 - 8 - 8 february april - 10 - 10 sources : statistics sweden and the riksbank repo rate cut to 0. 5 per cent economic downturn worsening low repo rate for long period of time positive growth in 2010 low repo rate for long period of time per cent, quarterly averages 90 % 75 % 50 % repo rate note. the uncertainty interval does not take into account the zero bound. source : the riksbank

##ksbank has raised the interest rate in a number of stages since january 2006 and that these increases have not yet had a full impact on the economy. what has happened since the monetary policy meeting? so far my assessment is that outcome data and indicators in the euro area are largely in line with the assessment in the main scenario of the monetary policy report. my opinion is also that the indications of weak us growth at the beginning of this year and the continued problems on the housing and property markets are in line with the assessment in the main scenario. in the short - term perspective the assessment does not differ from my own. i am however more concerned that it will take longer before the recovery gathers pace. swedish gdp growth during the fourth quarter last year was somewhat stronger than expected in the monetary policy report. employment, measured as the number of hours worked, increased at an unexpectedly high rate and productivity growth last year was weaker than expected in the report. the national institute of economic research ’ s business tendency survey for february shows a clear slowdown in economic activity in the business sector as a whole. the business tendency survey suggests that employment has continued to increase, but at a slower rate. companies have adjusted their recruitment plans downwards ahead of the coming months. in contrast, the purchasing managers index displays a more positive view in february. the total index rose somewhat and during several months fluctuated around the level of 55, which is close to the average since 2001. however, at the same time, the survey shows that growth in employment has slackened and that companies have become less optimistic about output growth in the future. in january inflation in sweden was somewhat lower compared with the forecast in the monetary policy report. however, this was largely connected with the fact that the weights in the cpi basket, as at the end of each year, had changed. the effects of this change were unusually large this time. this could be interpreted as though consumers, to a greater extent than normal, have replaced goods and services that increased rapidly in price in their consumption. the so - called substitution effect was then greater than the riksbank and most other analysts had assumed. all in all, activity in the swedish economy during the final quarter last year appears to have been slightly higher than we expected in february. productivity on the other hand showed weaker development than in the assessment in the report. survey data clearly suggests however that a slowdown is occurring in most parts of the business sector and that the increase in the demand for labour is on the