Riksbank’s hawkish surprise motivated to strengthen the Krona. Antje Praefcke, FX Analyst at Commerzbank expects the SEK to enjoy further gains this year.

Riksbank makes a U-turn

“The Riksbank did exactly what it had to: it produced a hawkish statement and thus illustrated that it continues to take decisive action against price risks. In my view that was a job well done! The market is appreciating this decision and is trading SEK at higher levels after it had questioned for some time whether the Riksbank really will dare take this step.”

“Riksbank has proven itself determined in its fight against inflation. The bank itself puts it very well: It is ’important for monetary policy to act when inflation is too high’. I, therefore, stick to my view that the market is trading SEK at excessively low levels and that it should appreciate over the course of the year.”