EUR/SEK upticks remain a selling opportunity – Rabobank

Head of FX Strategy at Rabobank Jane Foley sees occasional strength in the Swedish Krona as opportunities to sell the cross.

Key Quotes

“Following the release of soft CPI inflation data at the start of the year, the Riksbank has been able to push back against expectations of an imminent rate hike. The result has been an uptrend in EUR/SEK back to multi-year highs”.

“Sweden is a small and open economy and the Riksbank will be operating with one eye on the exchange rate. SEK weakness, however, does represent a loosening of monetary conditions and most economic data release point to robust growth”.

“Any push higher in inflation data will reawaken of tighter policy in the medium-term. We see EUR/SEK as overbought and favour selling rallies in EUR/SEK with a medium term target of EUR/SEK10.00”.