Rabobank’s Senior FX Strategist Jane Foley focuses on the Swedish Krona (SEK), noting that SEK has been the weakest G10 currency since the Iran war but has recently outperformed on a one‑month view. Foley highlights EUR/SEK technical levels around 10.76–10.85 and expects range trading over 1–3 months, with a moderately firmer SEK tone into year‑end, conditional on Sweden’s economic recovery and Riksbank policy.

EUR/SEK capped by key moving averages

"Measured since the start of the Iran war, the SEK is the worst performing G10 currency. It has performed a little better on a 1-month view. Indeed, measured since May 18, it is the best performing G10 currency."

"That said, the move lower in EUR/SEK from May 18 failed to move beyond support offered by the 100 day sma at EUR/SEK10.76 leading to a modest bounce in the currency pair. Resistance is likely to be offered by the 50 and 200 days sma's both at the EUR/SEK 10.85 level. Short-term this suggests range trading."

"Whether or not the currency pair break out to the topside or the downside is likely to depend on whether Sweden’s economic recovery can re-gain traction and whether this leads to a more hawkish position from the Riksbank. We see scope for range trading on a 1-to-3-month view. For choice, we then expect a moderately firmer tone to emerge in the SEK into the end of the year."

"In our view more solid signs of economic recovery should allow the SEK to re-gain moderate upward momentum into the latter months of the year."

(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor.)