The positive trend of EUR / SEK observed in the last eight years could have come to an end, according to Rabobank’s currency analysis team, which forecasts that the euro points to 10.30 in anticipation of a decline in the medium term.
Key statements
“In recent weeks a consensus has been building that the Swedish economy will suffer a less severe decline from the covid-19 crisis than the EU or the United States. The obvious assumption is that the lack of a formal shutdown in Sweden this year helped protect aspects of the economy, although the cost was a higher death toll than its neighbors. ”
“One possible concern for the Riksbank is that there are signs that the EUR / SEK uptrend that persisted between 2012 and early this year is showing signs of reversing. This is likely to reinforce the central bank’s dovish rhetoric. While the Riksbank is likely to continue to downgrade the SEK via its reference to policy options, we expect to see EUR / SEK at 10.30 at 3 months ahead, and the currency pair to drift lower to medium term”.
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Credits: Forex Street
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