Swedish Krona slides at the interbank market against the Pound for six consecutive days. During the first trading day of the week the GBP/SEK exchange rate settled up 0.47% at 12.5675, but the pair was seen quoted within a trading range of 12.5002 and 12.5796.
The Scandinavian currency is on the verge to break above the 2019 low established on 13 December at 12.6263. Despite Riksbank’s move to abandon negative interest rate policy NIRP, the local currency can’t catch a break. Since the beginning of the year, currency investors have dumped the SEK in favor of the GBP. The broad-based Pound strength was driven mainly by fading Brexit uncertainties and the UK political stability following the Boris Johnson’s Conservatives securing landslide victory in the recent UK elections.
On the data front, a possible market-moving event that placed the Swedish Krona on the wrong foot was the German IFO index for January. The survey revealed that the German GDP will grow by 0.3% in the first quarter of 2020 following the 0.1% growth rate expected in the last quarter of 2019.
The downbeat figures resuscitated the selling interest in the Krona.
In Sweden, the producer price inflation PPI followed by the Retail Sales figures scheduled at 8:30 AM GMT, are the main market mover for today. The market expectation is for the retail sales volume to decrease. At the same time, the inflation in Sweden is expected to accelerate in December. The mixed bag of data will keep the GBP to SEK exchange rate on the edge.
From the other side of the monetary policy spectrum, the British Pound has the chance to recover following the post-election dramatic sell-off.
From a technical perspective, the GBP/SEK exchange rate gained some follow-through momentum and painted a 7 week high. The GBP/SEK added to the previous week’s positive gains and has the potential to post a new multi-year high if it can find a catalyst to break through the 13 December high.
GBP/SEK was down -0.14% to 12.5501 in the late Asian session on Tuesday.