FXStreet (Edinburgh) – According to Strategists at TD Securities, the Nordic cross could head towards parity in the medium term.
Key Quotes
“It has become more difficult to position for the easing risks from the Riksbank. Several members seem to now have a more mixed opinion of taking rates more negative. So if SEK appreciates, it is possible the short-end rallies further, but it is also possible they decide to rely more heavily on QE, which would have a broader influence on the curve, or even introduce an FLS-style program, where the impact on rates is more uncertain.
“The Norges Bank‘s decision to cut its key policy rate to 1.00% was broadly expected. But leaving the door open to additional easing in the next few months was not. With the Riksbank on hold, NOKSEK will come under additional pressure and drop toward par in the months ahead”.
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