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MONEY

Sweden’s central bank keeps interest rate steady at zero percent

Sweden’s central bank has predicted that its interest rate, which has not edged above a historic zero for over six years, will remain unchanged for three more years.

Sweden's central bank keeps interest rate steady at zero percent
Sweden's central bank has presented its latest monetary forecast. Photo: Fotograferna Holmberg/TT

“Despite the spread of the coronavirus having increased again, the Swedish economy has developed relatively well, supported by extensive economic policy measures,” said the central bank, the Riksbank, in its latest monetary policy report on Tuesday morning.

“The economic outlook is slightly brighter now than it was in February, but the pandemic is not over, and inflationary pressures remain low. Monetary policy needs to remain expansionary to support the economy and for inflation to be close to the target of two percent more permanently,” it added.

The Riksbank said it would continue to purchase assets within a 700 billion kronor framework as previously decided, and hold the country’s key interest rate, the repo, at zero percent. It predicted, as before, that the repo rate would remain at zero until at least 2024, and said it could also cut it below zero if necessary to stimulate inflation.

The bank took the landmark decision to slash the rate below zero in February 2015, hoping that the strategy would boost inflation to raise the price of everyday goods and services which had been stagnant, and therefore improve the Nordic nation’s economic prospects. Almost five years later, it was raised from -0.25 to zero in December 2019.

Sweden’s GDP is expected to grow 3.7 percent this year, which is higher than the Riksbank’s previous forecast of 3.0, released in February, and 3.6 percent next year (lower compared to the February forecast of 3.9). It expects Sweden’s unemployment rate to land at 8.6 percent this year, and recover slightly to 7.7 percent next year.

“Towards the summer, GDP growth is expected to gear up in Sweden and abroad,” said the bank. “However, the differences between various sectors and groups on the labour market are expected to remain substantial. The Riksbank assesses that total economic activity in Sweden will approach more normal levels towards the end of the year.”

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ENERGY

What rules are there for wood burners and fireplaces in Sweden?

With the price of electricity and heating going up, many people in Sweden have turned to wood burners and fireplaces to help heat their homes and lower their heating costs. What rules do you have to bear in mind?

What rules are there for wood burners and fireplaces in Sweden?

What fuel can I use?

As a general rule, you should only burn dry wood. Guidelines from the Swedish Environmental Protection Agency state that your wood must have dried for at least 6 months, in a covered outdoor location.

Once you’ve brought it inside, try to use it within two weeks – otherwise it can dry out too much, meaning it burns more quickly, produces less heat and more soot.

On the other hand, if your wood is too wet, this can also cause issues. It will produce a lot of smoke, will not burn well and will emit a larger amount of environmentally hazardous substances.

It is illegal to burn rubbish such as milk cartons or plastic, as well as impregnated or painted wood, chipboard and plywood.

Coal is rarely used for heating private homes in Sweden due to the environmental impact, although there are no official bans on burning coal in indoor fireplaces.

Keep in mind that many modern fireplaces or wood burners are not designed for burning coal, and older fireplaces may only be approved for burning wood, so make sure you check the recommendations for your heater if you plan on using coal.

On the topic of older fireplaces, make sure you check with your council or building owner whether you are permitted to use your fireplace before you light a fire. If it hasn’t been used for a number of years, you may need to schedule an inspection, where an expert will inspect your fireplace and chimney for any cracks or areas that need repairing.

When can I light a fire?

Depending on where you live, there may be rules on when you are allowed to light a fire if it is not your primary source of heating. This is usually referred to as trivseleldning – lighting a fire for cosiness or comfort, rather than necessity.

In Malmö, for example, you are only allowed to light fires in tiled chimneys (kakelugnar), open fireplaces or woodburners between October 1st and March 31st. Some municipalities – Malmö included – also recommend lighting a fire no more than twice a week, for a maximum of four hours at a time.

Anna Nordkvist, a chimneysweep in Västerås, prepares to swing a chimney brush into a chimney. Photo: Per Groth/TT/Scanpix

Stockholm and Gothenburg have no rules on what time of year you are allowed to light a fire, or how often, but all three city councils underline the importance of considering your neighbours and only lighting a fire on days where it is windy enough for the smoke produced to be sufficiently dispersed.

If you live in another area, try searching for elda inomhus, plus the name of your local municipality, to find out the rules where you live.

If you burn wood in a way that causes irritation to your neighbours, they have the right to complain to the local council’s environmental department, who have the power to issue you with a ban on using your fireplace.

How often should I clean my chimney?

Depending on whether you live in a house or apartment, you may be responsible for organising chimney-sweeping yourself, or this might be the responsibility of the owner of your building.

Usually, if your fireplace or wood burner is not your primary source of heating and you only use it occasionally, your chimney won’t need to be swept more than once every three years.

If you’re not sure when your chimney was last swept (either because you don’t use it very often or because you recently moved into your property), try contacting your local council or searching for sotare (chimney sweep) or sotning (chimney-sweeping), plus the area where you live for advice. Most councils have a list over the properties in their area with chimneys and when they were last cleaned, or they will refer you to their approved contractors who should be able to help you.

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