EUR/SEK expected to visit 10.30 in the short-term – Danske Bank
Senior Analyst at Danske Bank Stefan Mellin remains bearish on the Krona, expecting the cross to edge higher to the 10.30 region in the near term.
Key Quotes
“We reached our 10.00 Q1 target and remain bullish on EUR/SEK. The two-pillar backdrop for our negative view on the krona is (i) subdued inflation and too aggressively priced Riksbank and (ii) a housing market under pressure that will take a material toll on GDP growth. This week, Valueguard came in weaker than we had expected in February which suggests the downtrend has resumed already. In addition, the details in the February inflation data were on the weak side and we now think that the Riksbank will push the first hike beyond 2018 already in April”.
“Therefore, we raise EUR/SEK to 10.20 (10.10) in 1M, 10.30 (10.20) in 3M, 10.30 (10.20) in 6M and 10.10 (10.00) in 12M”.