Sweden's central bank hiked its key interest rate by 25 basis points to 0.25% on April 28 and flagged further tightening ahead in a radical shift of policy plans sparked by surging inflation, Report informs referring to Reuters.
The Riksbank has been caught by surprise by price rises, which have climbed higher and proved more persistent than it and many other central banks forecast.
As recently as February, the Riksbank had expected price pressures to be short-lived, saying it would not need to hike rates until 2024.
Now the Riksbank sees two or three more rate hikes this year and said it would also allow its balance sheet to shrink this year, another policy shift.
"The Board's forecast is that the repo rate will be raised gradually going forward and that it will be somewhat below 2 per cent in three years' time," the central bank said in a statement.
Analysts at banking group Nordea said their first impression was that the Riksbank had become "hawkish".
Russia's invasion of Ukraine, which Moscow calls a "special military operation", has added upward pressure to prices, already on the rise due to the lingering effects of the pandemic, with inflation hitting its highest level in decades.
Inflation ran at 6.1% in March, far above the Riksbank's 2% target.