GPB/SEK: Swedish Krona Rallies Ahead of Key GDP Data

Swedish krona got a little bit of a boost on the currency market amid improved sentiment this morning and ahead of key GDP data. Thursday, on the interbank market, Krona settled at 12.3351 up 0.41% from the previous closing price.

Thursday’s trading session saw GBP/SEK within the range of 12.3306 -12.4016. However, during the early Asia trading hours, the GBP/SEK exchange rate was seen quoted unchanged near yesterday’s close.

During the last trading day of the week, the investor’s focus will turn to the release of GDP figures for the third quarter. During the first part of 2019, Sweden economic activity slowed down and according to Wall Street analysts it’s expected to remain lukewarm in the third quarter as well.

The main factors contributing to the economic downturn are the sluggish labor market and export growth. External factors such as the global trade tensions are also adding mounting pressures on Sweden’s economy. The Nordic economy of Sweden is set to expand by 1.4% in 2019 compared to 2.4% from the prior year, which is the weakest growth pace seen in six years.

All market forecast points towards a subdued growth pace in 2020 as well, when the economic activity in Sweden is expected to slow further to 1.3%.

In other news, the new YouGov poll has given a little bit of a boost to the British Pound which is trying to challenge the big psychological number 1.3000 against the US dollar. The YouGov showed the Conservative has a commanding 68 seat majority in the UK parliament.

Global head of foreign exchange strategy at HSBC, David Bloom believes that the Pound faith is tight to the UK election outcome. If the Conservative Party will manage to gain a comfortable majority in the UK parliament, GBP is set to rally 12% to 1.45. On the other hand, a hung UK parliament and subsequently a no-deal Brexit can send Pound tumbling 15% to 1.10.

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