STOCKHOLM — Sweden’s central financial institution on Thursday raised a key rate of interest by half a share level, saying inflation “is way too excessive and has continued to rise.”

Riksbanken has adopted different central banks around the globe by enacting massive rate of interest hikes to tamp down worth spikes which have customers paying extra for meals, vitality and rather more. The U.S. Federal Reserve, European Central Financial institution and Financial institution of England additionally made comparable hikes final week.

“Excessive inflation undermines households’ buying energy and makes it tough for them and for corporations to plan their funds,” Riksbank mentioned in a press release. “It will be important for confidence within the inflation goal that inflation falls again clearly this yr, and there are various indications that it’ll achieve this.”

Greater electrical energy costs lifted inflation in Sweden to 10.2% in December, up from 9.5% in November as measured by the patron worth index with a hard and fast rate of interest. It was the very best stage in 31 years and much above the Riksbank’s inflation goal of two%, in keeping with Swedish information company TT.

To get inflation to fall “inside an inexpensive time,” the financial institution mentioned it raised charges to three%, the very best in practically 15 years, TT reported.

Starting in April, Riksbank additionally would begin promoting authorities bonds “to scale back asset holdings at a quicker tempo” and mentioned its forecast signifies that the rate of interest will in all probability be raised additional within the spring.

Sweden is a part of the European Union however doesn’t use the euro, so it isn’t a part of European Central Financial institution, which hiked charges by half some extent final week to fight annual inflation of 8.5%.