EUR/SEK Outlook: Bearish, as the rate is below its recent average and near recent lows, driven by ECB easing speculation.
Key drivers:
• Rate gap: The European Central Bank's (ECB) cautious approach contrasts with the Riksbank's stable policy, favoring the Swedish Krona.
• Risk/commodities: Rising oil prices have created pressures on the Eurozone's economic recovery, affecting the euro adversely.
• One macro factor: As Bulgaria joins the Eurozone, the economic landscape of the region may shift, impacting the euro's strength.
Range: EUR/SEK is likely to drift within its recent range, as signs point towards stabilization below the average.
What could change it:
• Upside risk: A stronger than expected Eurozone GDP report could boost the euro and challenge the current outlook.
• Downside risk: Further clarity on the ECB's monetary policy direction could add downward pressure on the euro against the SEK.
