FXStreet (Edinburgh) – Senior Analyst at Danske Bank Stefan Mellin argues the Nordic central bank remains focused on the SEK performance.
Key Quotes
“The Riksbank is likely to maintain the currency as a more or less explicit intermediate target”.
“Since the August peak the SEK has rallied 4.6% vs. the EUR and 5.5% vs. KIX. That is a lot and it is a concern for the Riksbank”.
“As such we see the recent break below 9.30 as being short-lived. Our short-term financial models have fair value at 9.35-9.40”.
“Over time the Riksbank is promoting a currency bubble – when it bursts we are in for a substantial rally in the SEK. However, this time has not come yet. We leave our forecast profile intact, targeting 9.40 in 1-3M and 9.00 in 12M”.
(Market News Provided by FXstreet)