In the year to date, the Swedish krona is the second-worst performing G10 currency after the New Zealand dollar. However, economists at Rabobank expect the EUR/SEk to turn back lower towards 10.20 as the Riksbank ditches dovish stance.

ECB officials has capped upside potential for EUR/SEK

“The failure of the Riksbank to follow the ECB’s hawkish pivot this month boosted the upside trend in EUR/SEK. That said, ECB officials have subsequently been attempting to pare back market expectations about any forthcoming policy moves from the Governing Council. This has capped upside potential for EUR/SEK.”

“Assuming there is no escalation in Russian military operations, we see scope for EUR/SEK to turn lower on a three-month view on the assumption that the Riksbank will announce its own hawkish pivot in the coming months.”

“Our three-month EUR/SEK forecast stands at 10.20.”

See – EUR/SEK: Bearish krona trend to remain in place until bigger shift in Riksbank policy – MUFG