In the opinion of Rabobank economists, there are a couple of factors that suggest a greater possibility of support for the Swedish Krona in the coming weeks.
Break above 12.00 could help restore confidence in Swedish krona
In the first week of foreign exchange sales, the Riksbank sold 390 million USD, slightly less than the market estimated. EUR was not sold. This process is expected to continue for 4 to 6 months.
Given the risk that SEK purchases coincide with further Riksbank rate hikes, the SEK should find some support.
The September high, which was just shy of 12.00 EUR/SEK, should offer a good level of resistance. If the currency pair does not break above this level in the coming months, it could help restore some confidence in the SEK.
We see the risk of a decline in the EUR/SEK to 11.40 in three months.
Source: Fx Street
I am Joshua Winder, a senior-level journalist and editor at World Stock Market. I specialize in covering news related to the stock market and economic trends. With more than 8 years of experience in this field, I have become an expert in financial reporting.
