Nordea expects Swedish rate cuts by autumn
Amid new highs in the NOK/€ and SEK/€ rates over the past couple of days, Nordea Markets said in its Swedish Morning Report today that it expects the country's central bank to cut rates by 0.5% by the autumn.
Amid new highs in the NOK/€ and SEK/€ rates over the past couple of days, Nordea Markets said in its Swedish Morning Report today that it expects the country’s central bank to cut rates by 0.5% by the autumn.
This would go some way to reducing the support for the SEK against the euro, as it would reduce the margins between ECB and Swedish interest rates.
“It is worth remembering that the krona as recently as the middle of May traded well above SEK9. But the favourible carry trade in the krona makes it attractive. The fact that the Riksbank is ‘on hold’ and the rest of the West favours a more expansive monetary policy is to the advantage of mother Svea. However, we believe that the Riksbank will lower its rate by 50 basis points this autumn, and the higher interest rate versus Europe which Sweden today enjoys will be marginally changed,” said analyst Niklas Håkansson.
Norway
In Oslo the NOK has hit 7.42 against the euro in trading this morning, reports Dagens Næringsliv. That means the currency has appreciated by 0.7% against the rate quoted one day earlier.
