The recent movement in the EUR to SEK exchange rate shows the euro trading at 10.93, approximately 1.8% below its three-month average of 11.13. This reflects a stable trading range of 10.92 to 11.31 over the past few months, indicating a moderate shift in the market sentiment for both currencies.
Analysts noted that the euro has gained strength following the European Central Bank's (ECB) decision to maintain interest rates and upgrade growth forecasts for 2025. ECB President Christine Lagarde emphasized a more balanced risk outlook for the Eurozone economy, which is perceived positively by the markets. Furthermore, developments such as Bulgaria's upcoming entry into the eurozone in January 2026 and the noted increasing global interest in euro-denominated assets suggest solidifying confidence in the euro.
On the other hand, the Swedish krona (SEK) has faced pressure following the Riksbank's unexpected interest rate cut to 2.00% and indications of potential further cuts. This shift has contributed to a bearish outlook for the SEK, with BCA Research warning of increased depreciation risks due to anticipated aggressive rate cuts amid an economic slowdown. UBS has also adjusted its year-end EUR/SEK forecast from 10.50 to 10.75, reflecting a divergence between the policy stances of the Riksbank and the ECB.
The euro's recent stability contrasts sharply with fluctuations in oil prices, which directly impact economic activity in the Eurozone and Sweden. Currently, oil is trading at 66.99, around 2.9% below its three-month average and reflecting volatility with a range of 65.50 to 78.85. This demonstrates the ongoing uncertainty in global markets, which can further influence currency valuations.
In summary, the combination of a strengthening euro due to supportive ECB policies and a weakening SEK following the Riksbank's dovish stance has set a divergent path for the EUR/SEK exchange rate. As these central banks continue to navigate economic challenges, future movements in this currency pair will likely depend on their respective monetary policy decisions and broader economic conditions.
