Economists at Danske bank see EUR/SEK in 10.10 in one-to-three months, before a move to 10.40 in 12 months on the medium-term inflation challenges that faces the Riksbank.
Key quotes
“We still argue that last year’s krona rally will come to a halt in the first half of 2021 as the recovery trades increasingly shift focus to medium-term inflation challenges that faces the Riksbank.
While inflation risks in the next couple of months seem fairly balanced, risks to monetary policy are skewed to the downside – especially since a negative ‘inflation gap’ starts opening up in H2 2021. This policy asymmetry is not reflected in pricing which is too steep in our view and thus a medium-term headwind for the SEK.
“We keep EUR/SEK 1M at 10.10 (unchanged), 3M at 10.10 (10.00), 6M at 10.20 (10.20) and 12M at 10.40 (10.30).”
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