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STOCKHOLM (Reuters) -The Swedish financial market is functioning well despite the recent global economic turbulence and the country is well placed to tackle turmoil, but the Riksbank is ready to act if necessary, central bank governors said on Tuesday.
The tariffs announced by U.S. President Donald Trump have raised uncertainty about future inflation and the recovery of the Swedish economy, Riksbank Governor Erik Thedeen said.
"It is clear that the range of outcomes for what might happen in the future has become much broader, both in terms of economic activity and inflation," he said. "Irrespectively, in Sweden we are in a good position to handle these developments."
Thedeen said Sweden's low sovereign debt offered room for manoeuvring if necessary and that the Riksbank kept a close eye on developments.
"Trade barriers are not good for economic developments, nor for inflation, and those who impose tariffs typically suffer the most themselves," he said.
Separately, Deputy Governor Aino Bunge said that while U.S. trade tariffs have been raised more than expected, the impact on inflation remains uncertain, and will depend on the response from other nations.
"What we see now is that the range of possible inflation outcomes has risen," Bunge said.
The Swedish inflation rate remains elevated despite easing in March, she added. Last month's headline consumer price growth stood at 2.3%, down from 2.6% in February. The Riksbank targets 2% inflation.
The rebound in the Swedish economy that began last year has shown signs of weakness in 2025, in household demand and the labour market, and faces uncertainty over U.S. trade policies, she said.
The bank was "following developments very closely" and stood "ready to act if necessary," Bunge said.
"Mainly, there are now stock market declines and not a big concern about other stability issues."
(Reporting by Johan Ahlander and Anna Ringstrom in Stockholm and Terje Solsvik in Oslo; Editing by Jamie Freed and Bernadette Baum)
