EUR/SEK seen rangebound, NOK to remain weak – Danske Bank

Sverre Holbek, Senior Analyst at Danske Bank, gives his views on SEK and NOK in the wake of the interest rate decisions by the Riksbank and the Norges Bank.

Key Quotes

“In terms of Scandi FX, neither the Riksbank nor Norges Bank provided much news to trade on at yesterday’s central bank announcements”.

“While Norges Bank had very little new information to react to since the last meeting in late September, the Riksbank did not want to send any new signals prior to the ECB announcement. In our view, the ECB decision that followed the two meetings should have a limited impact on SEK and NOK. The ECB decision underpins that rate hikes are not on the cards near term in the Scandies, which is why both EUR/SEK and EUR/NOK have moved higher”.

“Going forward, we think EUR/SEK is a 9.65 -9.80 range play and we look to sell spikes towards 9.80 as we think the important resistance lev els around 9.80 will hold unless the housing market suddenly tanks. On EUR/NOK, we still prefer to play the weak side of the Norwegian currency and don’t think it’s the time to buy NOK as year-end headwinds remain”.