GBP/SEK Outlook:
The GBP/SEK exchange rate is likely to move sideways as it trades near its 3-month average, currently at 14-day highs but still below its average. Mixed signals from both the UK and Swedish economies impact the outlook.
Key drivers:
• Rate gap: The Bank of England seems more hawkish compared to the Riksbank, which keeps its policy rate steady.
• Risk/commodities: A surge in energy prices raises inflation concerns in the UK, potentially complicating economic growth.
• One macro factor: Sweden’s economy is projected to grow positively this year, supported by government spending and a recovery in local demand.
Range:
Expect GBP/SEK to hold steady within the recent range of 12.12 to 12.56.
What could change it:
• Upside risk: A hawkish shift in UK monetary policy could bolster the pound.
• Downside risk: Heightened geopolitical tensions may weaken the pound against the krona.