SEK vigilant on Riksbank meeting – Danske Bank

Morten Helt, Senior Analyst at Danske Bank, gave his view on the prospects for the Swedish Krona ahead of the Riksbank meeting on Thursday.

Key Quotes

“EUR/SEK traded lower yesterday on the back of strong labour market data. The cross might see more headwinds today as the NIER survey is likely to point to improved optimism in Sweden”.

“However, EUR/SEK downside potential should be limited, as focus remains on the very important Riksbank meeting tomorrow, where we expect the Riksbank to announce that it will not extend the current QE programme”.

“We still see risks skewed slightly to the upside for EUR/SEK on the Riksbank announcement, as we believe that the Riksbank will avoid sending a hawkish signal. Thus, we prefer to wait entering/adding short positions until after the Riksbank meeting”.