EUR/SEK could revisit the recent high of 10.90 after Sweden’s Riksbank went big and raised the policy rate by 100 bps to 1.75%, economists at Société Générale report.

Policy rate path significantly increased

“Riksbank raises policy rate by larger than forecast 100 bps to 1.75%, signals further tightening in next six months. Rate forecast raised to 0.7% this year, 2.5% in 2023 and 2.5% in 2024.”

“The pair is expected to revisit recent high of 10.90. Overcoming this can extend the move towards 11.05, the 76.4% retracement from 2020 and projections of 11.26.”

“Recent pivot low of 10.60/10.56 is near-term support.”