EUR/SEK to slide below 10.50 on more optimism on the Ukraine war – ING
|SEK, a key benchmark for Ukraine-related sentiment, has rebounded strongly on the back of peace-talks optimism. Still, more positive news on this front are needed to see the EUR/SEk pair trading below the 10.50 mark, economists at ING report.
Above expectation inflation read in Sweden
“The krona’s good momentum is linked to a hawkish re-pricing of Riksbank’s rate expectations, which were fuelled first by the ECB meeting last week and by yet another above-consensus CPI read in Sweden yesterday. With core CPIF inflation running at 3.4%, a hike by the Riksbank already in 2022 no longer appears as a remote possibility.”
“Still, 100bp of tightening is already in the price for the next 12 months, which means that more optimism on the Ukraine war will be needed for EUR/SEK to consistently trade below 10.50.”
See – EUR/SEK: Only in the course of 2023 will the krona make any further gains – Commerzbank
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