joining us now, james pomeroy. he is in london. what you think they will end up doing? it is a difficult decision. everyone in that consensus knows riksbank is going to have to lower inflation forecast. normally that will mean further easing. if you look at the wider economy . it growth, credit growth, this economy doesn't need an active interest rate. guy: how do they manage this story of fixed inflation at the same time as managing the story of housing market and an economy that is on the front foot? how the balance those two things? past: you have to look the the currency inflation rate. house prices are up. credit growth is pretty strong. inflation expectation services are started to pick up -- services have started to pick up. if they take all of those things, there is no point of current headline inflation. sweden's economy is doing great. really strong consumption and investment. this lower inflation has not been a big problem. guy: there are some that suggest that maybe the central bank should invest in the currency markets. think that is a way of squaring the c

alix: nevertheless, the recent rate rise is the first with the index below 50. ,e are joined by james pomeroylobal economist. services can make up the slack in manufacturing? james: we are looking at not just the u.s. economy but most developed markets. the manufacturing sector in the u.s. and europe is only about 20% of the economy. when we get weak manufacturing data, what we are really looking at is the service sector, which globally continues to do pretty well. non-manufacturing i sm is still around the 55 mark. iseloped market growth holding up quite reasonably at the moment. fed vice-chairman stanley fischer also spoke with tom keene the efficacy of negative interest rates. take a listen. that have used it continue to use it. they have not given it up. and we even had the danes continuing a contractor he -- continuing the policy. working more than i can say that i expected in 2012, but i wasn't on the committee at that stage. about thee's talking the ecbt sweden and have also cut interest rates to negative. negative interest rates have a nonlinear reaction or function on the markets ove