Wikipedia says it best:
Yarn bombing, yarnbombing, yarnstorming, guerrilla knitting, urban knitting or graffiti knitting is a type of graffiti or street art that employs colorful displays of knitted or crocheted cloth rather than paint or chalk.
Hence, the appropriateness of putting a giant knitted Kilroy, symbolic graffiti dude, on a pole on Götgatan, near the Slussen T-bana entrance.
I’ve been keeping an eye out for other yarn graffiti, but the sightings have been few. In the process, however, I did spy some super-cool mittens on a fellow Metro rider.