Recent analyses indicate a cautious outlook for the EUR to SEK exchange rate. Currently, the euro is trading at approximately 10.86 SEK, which is 1.0% below its three-month average of 10.97. This stability in the EUR/SEK pair has been characterized by a narrow trading range of 2.1%, from 10.84 to 11.07.
The European Central Bank (ECB) has recently expressed concern about the potential adverse effects of a strong euro on inflation. ECB President Christine Lagarde’s warning suggests that the central bank is wary of further euro appreciation, which could complicate efforts to manage inflation. The eurozone has seen a slight uptick in inflation, now at 2.2%, challenging the ECB's prior forecasts of declining inflation into 2026. Experts believe that any lingering uncertainties related to the war in Ukraine and energy price fluctuations will continue to exert pressure on the euro's value.
Conversely, the Swedish krona (SEK) has gained traction due to the Riksbank's recent interest rate cuts, which have unexpectedly strengthened the currency against the euro. Most notably, the Riksbank reduced its policy rate from 2.00% to 1.75% this past September, leading analysts at UBS to revise their year-end EUR/SEK forecast to 10.75, anticipating further SEK appreciation as the bank continues to adjust its monetary policy.
Global oil prices could also play a significant role in influencing the EUR/SEK dynamics. Current data shows oil prices at $60.83, which is 4.5% below their three-month average. The volatility observed in oil, fluctuating by 18.8% between $59.04 and $70.13, could indirectly impact the euro through its effect on inflation and economic stability in the Eurozone, as the region remains heavily reliant on energy imports.
As declining oil prices may ease inflationary pressures, the evolving policy stances of both the ECB and Riksbank, along with geopolitical factors, are critical in shaping the EUR/SEK outlook in the coming months. Continued vigilance on these fronts will be essential for businesses and individuals engaging in international transactions involving the euro and Swedish krona.
