to around 30 per cent of gdp, but now the figure is around 50 per cent of gdp. this means at the same time that exports are very important to the swedish economy and that the weak economic growth abroad therefore hits sweden particularly hard. new information during the summer points to a slight improvement to summarise, the new information received during the summer tends to point to a slightly stronger economic activity than we had forecast at the beginning of july. gdp was three tenths of a percentage point better and employment fell two tenths of a percentage point less than we had forecast. a number of indicators have also exceeded market expectations. all in all, this supports the view we had that the deep economic recession has bottomed out. however, most indications are still that the recovery will be weak. inflation fell slightly more than we had anticipated in july, but underlying inflation was in line with our forecasts. however, we will not make an overall assessment of economic developments until it is time for our next monetary policy decision on 2 september. it is likely that more information will have come in by then and we will have to update our forecasts. monetary policy monetary policy is expansionary since the financial crisis worsened last autumn, monetary policy has been aimed at moderating the depth of the economic recession following in the wake of the crisis. the repo rate was cut from 4. 75 per cent in september 2008 to an all - time low of 0. 25 per cent in july 2009. the riksbank has also supplied the banks with liquidity to counteract the negative effects of the financial crisis. in this section i shall discuss in slightly greater detail our reasoning at the most recent monetary policy meeting, and the risks i see of developments being better or worse than we forecast. in july we cut the repo rate from 0. 50 to 0. 25 per cent. the economic recession appeared likely to be deeper than the riksbank had earlier forecast and we were expecting gdp growth to be slow over the coming years. resource utilisation would therefore remain low throughout the entire forecast period. at the same time, the forecasts for underlying inflation were close to the inflation target of 2 per cent. we therefore considered that the repo rate probably needed to remain at this low level until autumn 2010 ( see figure 22 ). we also decided to grant loans to the banks of sek 100 billion, with a twelve - month maturity and at a fixed interest rate. we have been lending money to the banks

a slightly quicker indicator of developments than the economic tendency survey and an index above 50 indicates growth. 7 labour market continues to weaken our assessment in the most recent monetary policy report was that the labour market would continue to be weak. a deterioration in the labour market usually lags behind in an economic downturn, which was also the case this time. we are expecting employment to fall by around 300, 000 persons from the peak in 2008 to a trough in 2011 and that unemployment will continue to rise to around 11 per cent ( see figures 15 and 16 ) see the oecd ’ s composite leading indicators, 7 august, 2009, http : / / www. oecd. org / dataoecd / 45 / 9 / 43453886. pdf. economic tendency survey, july 2009, national institute of economic research, 30 july 2009. institute for supply management ( silf ) and swedbank, 3 august 2009. after the recent monetary policy meeting new information was received from the labour force surveys, which was roughly in line with our assessment. employment fell by 1. 7 per cent in june compared with the same month in the previous year and unemployment increased to 9. 8 per cent. this was respectively two - tenths and one - tenth of a percentage point better than we had forecast. 8 underlying inflation is in line with the inflation target of 2 per cent inflation has fallen rapidly in recent months and is expected to become negative for a large part of the year. however, cpi inflation is strongly affected by interest rate changes and by changes in energy prices. it is therefore better to study the underlying inflation rate. underlying inflation measured as the cpif, where mortgage rates are held constant, is expected to be close to 2 per cent throughout the forecast period ( see figure 17 ). new inflation figures published after the most recent monetary policy meeting have also been roughly in line with our assessments. cpi inflation was - 0. 9 per cent in july, which was three tenths of a percentage point lower than our forecast, but underlying inflation measured as the cpif amounted to 1. 8 per cent, which was entirely in line with our forecast. 9 inflation measured in terms of the eu harmonised index, the hicp, was also 1. 8 per cent in july and when measured as the hicp excluding energy it was 2. 8 per cent. inflation was thus much higher in sweden than in the eu. one reason for this is probably that the krona has weakened since last