Headline CPIF inflation declined sharply from 3.3% to 2.5%, while the Riskbank's favoured CPIF excluding energy decelerated from 4.4% to 3.5%. The numbers are below our expectations and the consensus and partly endorse the optimism shown by the Riksbank at its latest policy meeting when it signalled rate cuts later this year.

Friday’s inflation expectations data released by Prospera are also very important for the Riksbank. 

We continue to prefer NOK over SEK as we prepare for a broad-based decline in the Dollar and improved risk sentiment in FX. In our view, EUR/SEK can find support at 11.20 in the coming days.