EUR/SEK: Swedish Krona remains vulnerable in the near term – MUFG
Analysts at MUFG Bank forecast the EUR/SEK to edge modestly higher to 11.900 by the end of the third quarter, and to drop later to 11.500 by the first quarter of 2024.
Riksbank to step up pace of QT to provide more support for SEK
The krona has re-weakened in August giving back all of the gains recorded in July. It has resulted in EUR/SEK hitting a new record high of 11.963 in August as it moved above the Global Financial Crisis high at 11.790 from March 2009. The krone has been undermined by the recent deterioration in global investor risk sentiment.
The krona would benefit more from a softer landing for the global economy which allows major central banks to begin lowering rates in response to the ongoing slowdown in inflation. The weaker krona if sustained will make it more challenging for the Riksbank to bring down inflation closer to their target.
The krona remains vulnerable to further weakness in the near-term, but we still expect a rebound in the year ahead.
Author
Matías Salord
FXStreet
Matías started in financial markets in 2008, after graduating in Economics. He was trained in chart analysis and then became an educator. He also studied Journalism. He started writing analyses for specialized websites before joining FXStreet.
