EUR/SEK: Buying on dips – Nordea

The chorus advocating or predicting a rate cut back by Riksbank to negative territory has intensified while Sweden is receiving a lot of foreign attention based on its so-called laissez-faire response to the corona crisis, analysts at Nordea briefs. EUR/SEK trades at 11.036.

Key quotes  

“The jury is still out on whether Sweden's approach to coronavirus will in the end be judged a success. If it is judged a success it could become a slightly SEK-positive driver.”

“If the Riksbank were to cut rates back into negative territory (not our forecast), it risks destabilizing the already weak SEK.”

“We stay cautious on the SEK, and advise buying EUR/SEK on dips, since the acceleration phase seems to be kicking in in Swedish virus data.”