Why the Swedish Krona’s Tug-of-War Against the Euro Could Make or Break Your Next Big Move—Don’t Sleep on This!

Rabobank’s Senior FX Strategist Jane Foley focuses on the Swedish Krona (SEK), noting that SEK has been the weakest G10 currency since the Iran war but has recently outperformed on a one‑month view. Foley highlights EUR/SEK technical levels around 10.76–10.85 and expects range trading over 1–3 months, with a moderately firmer SEK tone into year‑end, conditional on Sweden’s economic recovery and Riksbank policy.

EUR/SEK capped by key moving averages

“Measured since the start of the Iran war, the SEK is the worst performing G10 currency. It has performed a little better on a 1-month view. Indeed, measured since May 18, it is the best performing G10 currency.”

“That said, the move lower in EUR/SEK from May 18 failed to move beyond support offered by the 100 day sma at EUR/SEK10.76 leading to a modest bounce in the currency pair. Resistance is likely to be offered by the 50 and 200 days sma’s both at the EUR/SEK 10.85 level. Short-term this suggests range trading.”

“Whether or not the currency pair break out to the topside or the downside is likely to depend on whether Sweden’s economic recovery can re-gain traction and whether this leads to a more hawkish position from the Riksbank. We see scope for range trading on a 1-to-3-month view. For choice, we then expect a moderately firmer tone to emerge in the SEK into the end of the year.”

“In our view more solid signs of economic recovery should allow the SEK to re-gain moderate upward momentum into the latter months of the year.”

(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor.)