Inflation
Last time I wrote about this it was 2022 and inflation was going wild. Now some time has passed and first let’s have a look at the indicators that I watch.
Starting with the CRB Index in SEK it has consolidated at these high levels and the average is still rising. Commodity prices has definitely not broken down yet so this is an area of worry for me.
Next up is the annual consumer price index for Sweden. This has come off considerably and is continuing to drop. I am a bit concerned that the continued strength in the commodities will result in the CPI drop stalling and not approaching the target level of 2% though.🚩
Now looking at the gold prices compared to the Swedish Krona. Gold has had a monster run for sure while the Swedish Krona has been weak. I exited my Gold positions way to early obviously.ðŸ˜
Finally here is the real interest rate in Sweden where I adjust the 10 year interest using the consumer price index as the inflation rate. The real interest rate is still negative but has approached the levels where it has been historically.
Of my four inflation indicators in Sweden there are still three that are negative which is rather alarming.
The stock market
My overall stock market indicators are still positive, except for the PE ratio valuations. They are still not outrageous though so I feel rather good about continuing to hold some stocks.
I have a dividend producing portfolio of stocks that is producing very good results with main holdings in Bahnhof, Nordnet and Tele2. All of them have gone through some multiple expansion so they are not that attractive for new investments as they were a couple of months ago though.
How about savings accounts?
There are still a lot of good savings accounts paying a nice interest rate. SLANTAR.se has good comparisons for both individuals and companies. You might even consider entering into some agreements where you secure certain interest rates on your savings accounts for a year or two at this stage if you know that you will not need that cash for other purposes during that time.
Should I do anything about my house loans?
That is a tough nut to crack. The rates are currently not very low, nor extremely high. There is room for them to both go up and to go down. I don’t think that there are any great deals to be had so if loans are up for renewal I would simply let them run with the standard 3-month renewal rate and wait for better opportunities!