GBP/SEK Exchange Rate Edges Higher as Swedish Unemployment Increases while Consumer Confidence Remains on Shaky Ground
The Pound Swedish Krona (GBP/SEK) exchange rate moved higher today and is currently trading around 12.01kr.
The Swedish Krona (SEK) eased against the Pound (GBP) despite the printing of the Swedish consumer confidence figures for June, which improved to 93.8, although this was less than the forecast increase of 95.2.
However, Sweden’s National Institute of Economic Research (NIER) warned that sentiment was sliding, stating:
‘A weaker outlook is putting a damper on manufacturing investment, and consumers are increasingly negative about the economy despite a strong labour market. This consumer pessimism is expected to impact on consumption this year.’
SEK struggled following the release of higher unemployment figures for May, which exceeded forecasts at 6.8%.
Meanwhile the Pound is trading higher since last night’s second parliamentary vote on the next Conservative Party leader, with Boris Johnson once again coming out on top, while Dominic Raab, the former Brexit Secretary, was eliminated.
GBP/SEK Exchange Rate Rises as UK Retail Prices Increase
The Pound edged higher following higher UK RPI figures for May, which rose above the 0.2% consensus to 0.3%.
Today, however, saw the UK CPI inflation figures ease to 2.9% for May, leaving some Sterling investors feeling jittery as this effectively rules out a rate hike from the Bank of England tomorrow.
Tom Stevenson, an Investment Director for Personal Investing at Fidelity International, commented:
‘In the thick of a leadership contest – and with Brexit as far from resolution as ever – the Bank will most likely err on the side of caution as we face continuing political and economic uncertainty during the rest of 2019.’
The ongoing Conservative leadership race is still in focus today, with Jeremy Hunt, the Foreign Secretary, increasing his attacks on Boris Johnson.
Mr Hunt, clearly referring to Boris Johnson, said:
‘The problem here is that everyone makes promises they can’t deliver, there can be no stability and everybody’s going to be let down. My message to Conservative voters is: my message sounds uncomfortable, but it’s true.’
Pound Swedish Krona (GBP/SEK) Exchange Rate Forecast: Sterling Could Sink on Dovish BoE Statement
Sterling traders will be looking ahead to tomorrow’s interest rate decision from the Bank of England (BoE), which is expected to hold at 0.75%.
However, following signs of weakening inflation, investors will be focusing on the speech by BoE chief Mark Carney.
Any dovish comments from Mr Carney could see the GBP/SEK exchange rate fall.
Swedish Krona (SEK) investors, meanwhile, will be focusing on global political developments, with the Swedish economy being particularly sensitive to ongoing US-China trade tensions and the UK’s Brexit uncertainty.
The Pound Swedish Krona (GBP/SEK) exchange rate could sink tomorrow if there are any dovish comments surrounding the BoE’s interest rate decision, and as the ongoing Tory leadership competition continues to eclipses Brexit discussions, this is likely to leave Sterling traders feeling jittery on no-deal fears.