Aila Mihr, Analyst at Danske Bank, gives her views on the prospects for NOK and SEK.
“In the Scandies, yesterday was a very volatile session as markets digested a range of Riksbank board comments”.
“In short, we think markets over interpreted the comments and our general view remains that risk is to the upside for EUR/SEK”.
“NOK saw general support in yesterday’s session but erased some of its gains as the oil market sold off: the EIA inventory report came in line with the API report from Tuesday , showing a large decline in crude stocks of more than 5mb”.
“That would normally be bullish for the oil market, but in our view the lower level of US stocks could spur concerns that OPEC+ will end cuts early; hence, the negative reaction. In terms of the NOK, we see several arguments for why the cross should move higher in the months to come”.
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