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(Bloomberg) — Sweden’s core inflation rate was slightly lower than expected in October, increasing the probability that the country’s central bank will end a year-and-a-half long tightening campaign later this month. 

Prices excluding energy and interest-rate changes rose by 6.1% from a year earlier, a release from Statistics Sweden showed Tuesday. That was lower than the 6.3% expected by economists in a Bloomberg survey while the Riksbank projected a 6.0% pace at its latest meeting. The measure of inflation on core goods and services could be a decisive factor for the Riksbank’s next interest-rate decision, which is set to be announced on Nov. 23. 

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The central bank faces an increasingly difficult balancing act as Sweden’s economy shows clear signs of weakening while inflation remains distinctly above its 2% target. Of particular concern to Riksbank Governor Erik Thedeen and his colleagues is a rapid increase in the prices of services, coupled with a weak Swedish krona, that makes imported goods more expensive. Those factors have led several economists to pencil in a quarter-point rate hike, to 4.25%, later this month.

Still, the central bank could opt to put another rate hike on hold as the Nordic country is now seeing unemployment rise and highly-indebted property firms find themselves in trouble as borrowing costs continue to surge. That would buy policymakers time to get a clearer picture of how prices and the economy are developing. 

The CPIF inflation rate that the Riksbank formally targets rose to 4.2% in October, from 4% in the previous month, which was affected by a large year-on-year decline in electricity prices. The central bank expects CPIF to stabilize near its 2% target in the second half of next year.

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