Pound Extends Gains Vs Swedish Krona as GBP Exchange Rates Climb
The Pound to Swedish Krona (GBP SEK) exchange rate continued to trend higher this morning as markets become increasingly optimistic about the chances of the UK making progress in Brexit negotiations.
The interbank GBP SEK exchange rate is currently at around kr11.2776, up 0.43% from its opening levels of around kr11.2288.
Pound Sterling (GBP) Exchange Rates Lifted by Hopes of Brexit Progress
Pound Sterling sentiment is on the rise again today on hopes that the UK is inching closer to reaching an exit agreement with the EU.
Further bolstering confidence in Brexit negotiations this morning, and giving Pound exchange rates another shot in the arm, was a report in The Times about encouraging progress in border talks with Ireland.
According to the paper, the UK government is prepared to grant special powers to Northern Ireland to ‘avoid regulatory divergence’ with the Republic of Ireland.
Sean Callow, senior currency strategist at Westpac said;
‘The overall impression is that the pound is shedding more of its political risk premium after the budget and especially as Brexit talks make progress.’
‘The market seems inclined to assume the best on the talks, with interest today in The Times’ report that Britain is close to a deal on the Northern Ireland border.’
This comes on the back of reports that the UK may have finally reached an agreement over the size of its Brexit bill after the UK government was said to have offered a €50bn divorce payment.
With only the issue of EU citizens’ left to solve before the EU summit next month, observers are optimistic of the chances of EU leaders voting to allow trade discussions to begin by the end of the year.
Swedish Krona (SEK) Weakened by Lacklustre Growth Figures
The Swedish Krona (SEK) offered little resistance against the Pound (GBP) today as markets remained dejected following yesterday’s disappointing GDP figures.
According to Sweden’s statistics office, domestic growth only rose to 2.9% in the third quarter, up from 2.7% in the second quarter, with Q2 growth itself being revised down from 3.1%.
With economists having forecast that growth would hit 3.5% it was a major blow to the Krona as analysts fear that growth may have peaked this year.
In fact the figures also appear to have validated the move by Swedish Bank SEB to cut its domestic growth forecasts for 2018 from 3.1% to 2.6% as it warns that falling house prices may continue to dampen GDP.
GBP SEK Exchange Rate Forecast: Sterling Gains to be extended by Manufacturing PMI?
Looking ahead GBP SEK exchange rate may be able to close this week’s session even higher as economist forecast that the UK’s latest Manufacturing PMI will show a rise in factory activity tomorrow.
However even a dip in the index may do little to dent Sterling as investors may choose to overlook the data in light of apparent progress in Brexit negotiations.
Meanwhile Sweden will release its own Manufacturing PMI tomorrow which may help the Krona to stem is losses should it have ticked higher in November.