SEK/USD Outlook:
Slightly positive, but likely to move sideways, as the rate is above its recent average yet lacks a clear driving force.
Key drivers:
• Rate gap: The Riksbank's recent interest rate cut indicates a more accommodative monetary policy compared to the stable rates maintained by the Federal Reserve, which is contributing to SEK's strength.
• Risk/commodities: Current oil prices remain relatively volatile, which can influence the currencies of commodity-exporting countries, including Sweden.
• One macro factor: Improved GDP growth projections in Sweden provide a backdrop for potential SEK appreciation, although uncertainty prevails over global economic conditions.
Range:
Expect SEK/USD to generally hold steady, with occasional fluctuations as the market tests the recent highs while staying within the established range.
What could change it:
• Upside risk: A surprise boost in U.S. economic data could strengthen the dollar.
• Downside risk: Increasing geopolitical tensions could pressure the dollar further, impacting its value against the krona.
