The Shock of Sweden's Housing Market is Hitting the Country's Currency

House prices decline nationwide raising stability concerns
Slowing inflation also add to challenges for central bank

A cyclist passes residential apartment blocks in the Kungsholmen district of Stockholm, Sweden, on Wednesday, June 28, 2017. Just as Sweden’s biggest mortgage banks start raising interest rates, the country’s state-backed home-loan provider says it’s cutting customers’ borrowing costs in a move that threatens to hurt industry profits after years of negative rates.Photographer: Mikael Sjoberg/Bloomberg

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By Jonas O Bergman

November 14, 2017 at 3:45 PM UTC

Updated on

November 15, 2017 at 12:00 AM UTC

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Can a central bank steer the housing market?

Not so long ago, Sweden’s Riksbank decided: no. Now, there’s a risk that decision may backfire as the biggest property market in Scandinavia risks sinking into a correction.