I had a similar situation - the temp reading on the dash was high and I changed a bunch of parts, and nothing fixed it.
I used an IR thermometer to measure the temp on the thermostat housing - it was normal so I knew there was another problem.
Turns out the coolant sensor I replaced was sending the wrong signal down the yellow wire. It was a new after-market brand, which I returned and told the supplier from where I got it. They gave me a new one, and it was still sending the wrong signal.
I worked with my local Volvo dealer to source a Volvo OE sensor, and that solved the problem.
Thanks.
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