The Riksbank left its repo rate on hold today at -0.50% with a 5-1 vote, notes the research team at TD Securities.
Key Quotes
“The Executive Board indicated that its anticipated upcoming repo rate hike has been pushed back to December or February, from 18Q4 previously.”
“Beyond this change, the Riksbank left much of its economic assessment unchanged. It indicated that it wants to see strong growth translate through to higher underlying inflation before hiking. We continue to expect at 25bps hike in December.”
“FX: A dovish Riksbank keeps the SEK on the defensive, particularly ahead of this week’s national election in Sweden. While the SEK retains its longer-term, strategic appeal, we think EURSEK will continue to grind higher. That said, we think NOKSEK longs represent better risk/reward potential for SEK bears. This may have further to run as we think the NOK looks cheap relative to fundamentals.”
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