Sweden’s Riksbank Raises Interest Rates: EUR/SEK Downtrend Remains Intact

In Japan, the first half of 2015 was dominated by weak consumption and exports. In the short term, another rate cut will push the krona down, but signs of somewhat higher inflation will allow the Riksbank to lower its watch and a slightly stronger krona. Rate cuts in Australia and Sweden look less likely than in Canada.

The growth prospects for the region as a whole appear rather good. While the domestic outlook has not changed that much of policy reviews, the global easing trend has remained fully effective. Rather good prospects elsewhere in the Nordic region The economic outlook in the other Nordic countries is mixed.

The euro has a weak attempt to generate a clear trend with only the euro zone and the Italian current account figures moving. A weak currency and resilient budgets will limit the extent of the slowdown in Norway, while Danish growth will accelerate with the help of expansionary fiscal policies and good consumer growth. The Canadian dollar and Mexican peso are still spinning their tires against the greenback Monday, remarkably contrite areas to keep bouncing.

In Norway, Norges Bank focuses more on risks to growth and competitiveness than on inflation, which has been consistent with the central bank’s goal for some time. The Bank of Canada is due to make announcement on Wednesday. The central banks of the two other countries, Canada and Sweden, are due to make announcements on Wednesday and Thursday.

In emerging markets, however, growth will stabilize in 2017 as the situation in crisis countries like Russia and Brazil improve, while India will continue its rapid growth. The growth of world trade has slowed down compared to the pre-crisis situation. Looking at the 34 predominantly wealthy countries of the Organization for Economic Cooperation and Development (OECD) as a whole, it will be a bit delayed towards the end of our forecast period. GDP growth will thus remain roughly unchanged in 2017. It will accelerate in all three countries but will remain moderate, only because of a tighter labor market situation in 2017 their potential pace, GDP growth in the US peaked in 2016 and then approach its long-term trend in 2017.

In Sweden’s case, the likelihood of world trade getting worse before it gets better means that there will be persistent pressure on the crown. Depressive inflation expectations and a long period of good real wage increases suggest that high wage agreements are unlikely, despite labor market tensions. Meanwhile, uncertainty about emerging markets (EM) economic performance has intensified. There is greater uncertainty about reform efforts and the risk of political errors associated with deregulation of financial markets. SEKEUR price chart June 2018 present Uncertainty about the prospects of trade war remains one of the most important external challenges for Australia, Canada and Sweden. Watching for trade war updates can stir volatility, but it will struggle to generate trends if the market isn’t just waiting for the subject on a keyword.