EUR/SEK: Krona gains to be limited even on a hawkish Riksbank – Commerzbank

All eyes will be on the Riksbank today and whether they deliver their first rate hike. The Swedish krona could see mild gains if the central bank announces a faster rate path, economists at Commerzbank report.

What is the Riksbank going to do?

“If the Riksbank were to signal a faster rate path this would be positive for SEK; as the market is already expecting a reasonably tight Riksbank approach for the second half of the year anyway, SEK gains are likely to be limited, though.”

“If whatever the Riksbank is going to signal seems too little to the market SEK, which has come under pressure during the last days due to rising risk aversion, is likely to fall a bit further.”

See – Riksbank Preview: Forecasts from seven major banks, positioning for its first-rate hike