Swedens Policy Rate
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Mortgage rates rise despite unchanged policy rate: How it affects your wallet
On March 19, 2026, the Riksbank decided to keep the policy rate unchanged at 1.75 percent. Despite this, several banks have begun raising their mortgage rates towards the end of March. This development can directly impact household finances, even for those who assumed that an unchanged policy rate would mean stable borrowing costs.
Why are banks raising rates despite an unchanged policy rate?
Sources indicate that banks are adjusting their margins based on expectations of future policy rate hikes and continued high inflation. The Riksbank has warned that a series of rate hikes could become necessary if inflation does not decline. Analysts from institutions such as the National Institute of Economic Research (Konjunkturinstitutet) highlight that banks may act preemptively to manage their own costs if the interest rate environment changes rapidly. Thus, this is not a direct consequence of the Riksbank's latest announcement, but rather a reaction to uncertainty regarding future interest rate paths and inflation risks.
The difference between the policy rate and the mortgage rate
The policy rate is the interest rate the Riksbank charges when banks borrow money from it. The mortgage rate, however, is determined by the banks themselves and is influenced by more factors than just the policy rate, such as the banks' own funding costs and market expectations. Therefore, banks may choose to raise their rates even if the Riksbank holds steady.
How your daily economy is affected
- Mortgages and personal loans: Monthly loan costs may increase even if you have a variable rate, as banks are now raising their rates.
- Budget: It may be wise to anticipate higher borrowing costs in the future. If you have small margins in your finances, it is advisable to review expenses and plan for increased interest costs.
- Savings: Higher interest rate expectations may lead to slightly better returns on savings accounts, although the increase often occurs more slowly than for loan rates.
What can you do?
- Keep track of your mortgage rate. Even without a change in the policy rate, your bank may have adjusted the rate on your loan upwards.
- If you have a variable-rate loan, it may be worth contacting your bank to discuss your terms or comparing them with other providers. Market uncertainty means that terms can vary significantly.
- Be cautious about interpreting an unchanged policy rate as a guarantee of low mortgage rates. Banks' actions are driven by more factors than just the Riksbank's decisions.
Things to consider moving forward
The Riksbank has emphasized that the inflation forecast is highly uncertain. This means that both loan and savings rates can change rapidly, even without new announcements regarding the policy rate. The difference between the policy rate and the mortgage rate—i.e., the banks' margin—is crucial for how your costs develop. Therefore, following both the Riksbank's signals and the banks' actual rate-setting practices can be important for households with loans or significant savings.
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