Sweden’s Return to Deflation Raises Bets on December Cut

Sweden unexpectedly returned to deflation last month, sending the krona to its lowest against the euro since June 2012 as speculation increased the central bank will be forced to cut interest rates again.

Consumer prices fell an annual 0.1 percent in October, Statistics Sweden said today. They were seen rising 0.2 percent, according to a Bloomberg survey of 12 economists. Adjusted for mortgage costs, price gains slowed to an annual 0.6 percent from 0.9 percent.