Bias: bearish-to-range-bound, current USD/SEK is below the 90-day average and sits in the lower half of the 3-month range.
Key drivers:
- Rate gap: The Fed is expected to ease toward a neutral stance while the Riksbank keeps policy steady, narrowing the USD's yield advantage and reducing pressure from rate differentials on the krona.
- Macro factor: Sweden’s economy is projected to show stable growth and a healthier job market, supporting the krona as global risk appetite fluctuates.
- Global policy backdrop: Shifts in US tariffs and geopolitical risk can push the dollar higher or lower, affecting USD/SEK.
Range: USD/SEK is likely to drift within the lower part of its recent range, with occasional tests of the lower boundary, and liquidity conditions may stay modest as markets digest US and Swedish data.
What could change it:
- Upside risk: stronger US data or a hawkish Fed stance that keeps the dollar firm.
- Downside risk: softer US data or signs of quicker Fed easing that lift the krona.
