Today markets should see the Riksbank cutting rates by 25bp to 3.50%, ING’s FX strategist Chris Turner notes.

Market waits for a 50bp rate cut

“The market thinks there is a small chance of a 50bp rate cut. Our team continues to expect that the Riksbank will point to at least two further rate cuts later this year given the economy has been hit hard by higher rates and now that inflation expectations have fallen back under 2%.”

“We do not think EUR/SEK has to rally too much on the rate cut. And unless the Riksbank surprises with a 50bp rate cut today, our bias is that the softer US rate environment can carry EUR/SEK down to the 11.30 area.”