AUD/SEK Outlook:
The AUD/SEK shows a bullish outlook, trading significantly above its 90-day average and near recent highs. The Australian dollar benefits from strong demand for commodities and expectations of further rate hikes.
Key drivers:
• Rate gap: The Reserve Bank of Australia has a more hawkish stance compared to the Riksbank, which is considering a rate cut to address disinflation risks.
• Risk/commodities: Rising demand for Australian exports, particularly from China's recovering economy, enhances the AUD's value.
• Consumer Confidence: A significant increase in consumer confidence in Australia suggests a stronger domestic economy, potentially supporting ongoing AUD performance.
Range:
The AUD/SEK is likely to maintain its position near recent highs, showing stability within the current range.
What could change it:
• Upside risk: A notable increase in commodity prices or unexpected strong economic data from Australia could boost the AUD even further.
• Downside risk: If the Riksbank signals a stronger commitment to cutting rates or if inflationary pressures unexpectedly ease, the SEK may strengthen against the AUD.
