NOK/SEK still points southwards – TDS

FXStreet (Edinburgh) – Strategists at TD Securities see risks of further downside in NOK/SEK going forwards.

Key Quotes

“The renewed downside i n oil prices that we have been concerned about is once again putting pressure on the Norges Bank to cut futher. We don’t have another meeting until September, and the risk i s that the Norges Bank eases more than the 25bps cut that is currently priced in the market. Meanwhile, the Swedish story is a bit more stable as the data has weakened but SEK depreciation will be welcome at the Riksbank”.

“The Riksbank remains determined to counter any sign of SEK strength as the Swedish economy continues to struggle. With policy rates now firmly in negative territory, this becomes somewhat easier to accomplish. Still, we continue to see downside risk in NOKSEK as Norway suffers from a serious terms of trade shock and the Norges Bank has significant scope to cut rates further if necessary”.

Strategists at TD Securities see risks of further downside in NOK/SEK going forwards…

(Market News Provided by FXstreet)