Pound to Swedish Krona Exchange Rate Up on Brexit Hopes but Gains Limited
The Pound to Swedish Krona (GBP/SEK) exchange rate slipped from its best levels in the second half of the week, but the pair is still on track to sustain gains this week overall. Investors bought the Pound (GBP) again today thanks to Brexit hopes.
After opening this week at the interbank level of 11.84, GBP/SEK saw a jump in demand on UK data and Brexit hopes, briefly touching on a three-month-high of 12.03 on Tuesday before sliding.
GBP/SEK has been advancing again today though thanks to a late-week rise in Brexit hopes. At the time of writing, GBP/SEK was trending near the interbank level of 11.94.
The Pound’s strong gains this morning saw it rising against most major rivals, but its gains against the Swedish Krona (SEK) were comparatively limited. The Swedish Krona has also found support this morning following Sweden’s latest growth report.
Pound (GBP) Exchange Rates Renew Rally on Fresh Soft Brexit Hopes
Fears of a no-deal Brexit, which have dominated the Pound (GBP) outlook in recent months, continue to recede this week.
The possibility of a no-deal Brexit remains. However, efforts to prevent one, as well as recent speculation that a softer Brexit is becoming more likely again, helped the Pound to rally this week.
At the beginning of the week, the Pound jumped on hopes that Britain could avoid an imminent recession. Then, throughout the week, Sterling found further support in hopes that a no-deal Brexit was becoming less and less likely.
Sterling found a late-week boost in demand today thanks to soft Brexit hopes.
Speculation that UK Prime Minister Boris Johnson may compromise his position on Brexit, as well as rumours Northern Ireland’s DUP party may also soften its stance on Brexit, both helped to further douse no-deal Brexit fears.
Swedish Krona (SEK) Exchange Rates Avoid Steeper Losses Thanks to Swedish Growth
The Pound to Swedish Krona (GBP/SEK) exchange rate gained less than other Pound (GBP) exchange rates today, as the Swedish Krona (SEK) found support in the latest Swedish data.
While yesterday’s Swedish inflation data was worse than expected and this morning’s yearly Swedish growth rate fell short of forecasts, the quarter-on-quarter growth rate beat projections.
Swedish growth was forecast to have contracted at -0.1% in Q2, but instead grew at 0.1%.
Avoiding a contraction was definitely good news for markets, as the Swedish Krona avoided major losses thanks in part to the report.
However, concerns persisted about the health of Sweden’s economy. According to economists, the data would be disappointing for Riksbank, and indicated that Sweden’s economy was likely to remain near stagnant in the coming quarters.
Pound to Swedish Krona (GBP/SEK) Exchange Rate to be driven by UK News Next Week
Sweden’s economic calendar looks a little quieter next week, save for August unemployment rate data due on Tuesday.
As a result, Pound to Swedish Krona (GBP/SEK) exchange rate movement is likely to be driven by upcoming UK ecostats and potential political developments.
The week’s key UK data will come in through Wednesday and Thursday’s sessions. Inflation stats will be published on Wednesday, with retail sales data and the Bank of England’s (BoE) September policy decision following on Thursday.
Data could influence BoE bets if they surprise investors, and any shift in tone the bank takes regarding Brexit or the economic outlook on Thursday could also inspire forex movement.
Much of the Pound’s recent gains have been due to Brexit hopes, but analysts are warning markets that these gains may not last due to the political uncertainty.
Expectations for sentiment shifts in UK politics or Brexit could mean more volatility for the Pound to Swedish Krona (GBP/SEK) exchange rate outlook going forward.