October 27, 2020 - Written by John Cameron
STORY LINK Pound to Swedish Krona (GBP/SEK) Exchange Rate Sinks on Hopes for Swedish Economy
GBP/SEK Exchange Rate Dips as Sweden Could Avoid Brunt of Second-Wave
The Pound to Swedish Dollar (GBP/SEK) exchange rate dipped today, with the pairing currently trading around 11.361kr.
The Swedish Krona (SEK) rose against Sterling today on growing hopes that Sweden could avoid the brunt of a second-wave of a Covid-19 lockdown.
However, Anders Tengell, Sweden’s chief epidemiologist, was more cautious, saying:
‘This is not a disease we’re going to get rid of, so we need to keep it at a manageable level.’
In other Swedish news, the third city of Malmö will undergo new local restrictions as the number of Covid-19 cases soar.
Eva Melander, who is in charge of infectious diseases in Skåne, commented:
‘It’s a very worrying development. We are in a completely different situation from what we were in only a week ago, and it's a serious situation.’
Pound (GBP) Rises on Brexit Hopes
The Pound (GBP) fell today despite renewed hopes of a post-Brexit trade deal, with negotiations due to be extended in Brussels later on this week.
A spokesman for the European Commission said:
‘I can confirm that negotiations are ongoing in London right now, they will run until tomorrow and then they will take place here in Brussels, as of Thursday.’
As a result, GBP has benefited from hopes that the two sides could reach a post-Brexit trade deal before the end of the year.
In UK economic news, however, the latest retail sales figures for October have painted a bleak picture for the British economy in the months ahead.
Ben Jones, CBI Principal Economist commented:
‘The fall in retail sales in October is a warning sign of a further loss of momentum in the economy as coronavirus cases pick up and restrictions are tightened across many parts of the country.’
‘It’s no surprise that sales have dipped despite no new direct restrictions on retail in England, as the evidence from earlier in the year suggests consumers become more cautious as case numbers rise.’
GBP/SEK Forecast: Could Brexit Hopes Boost Sterling?
Swedish Krona (SEK) investors will be awaiting tomorrow’s release of Sweden’s Retail Sales report from Sweden. If this shows any signs of improvement, then this could boost the Swedish Krona.
Tomorrow will also see the release of the latest Swedish Consumer Confidence report for October, which is expected to dip to 79.
The GBP/SEK exchange rate will continue to be driven by Brexit developments this week. If UK-EU talks progress towards a post-Brexit trade deal, then Sterling could rise.
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TAGS: Pound Sterling Forecasts