Riksbank worries over fallout from ‘sharp corrections' in house prices

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Swedish households' interest-rate expectations are guided by current levels rather than central bank projections, according to a memorandum published by Sweden's Council for Co-operation on Macro-prudential Policy, heightening the possibility that an eventual increase in real interest rates will prompt "sharp corrections" in house prices at a time when households' debt to income ratio average 170%.

The memorandum is one of three released this week that served as a basis for an examination of iss

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