The Pound is extending gains versus the Swedish Krona at the start of the new week. After a soft start to the beginning of last week, the Pound strengthened in the latter part of the week thanks to significant stimulus measures from both the Bank of England and the UK government.
The Pound versus Swedish Krona exchange rate closed the previous week 1.3% higher at 12.0881.
At 06:45 UTC, GBP/SEK was trading up 0.35% at 12.1440, as investors digest coronavirus developments over the weekend.
Pound Investors Consider Complete Lock Down
The Pound gained across the latter part of the last week after significant action from both the BoE and the UK Government to shore up the UK economy from the coronavirus impact. Last week UK Chancellor pledge £330 billion in a bailout package to support businesses through the coming months. The BoE also cut interest rates to a record low of 0.1% whilst also increasing the number of gilts purchased by £200 billion.
Finally, as Bris Johnson announced stricter measures to prevent the spread of the virus such as closing pubs, clubs, restaurants and gyms, Rishi Sunak pledged unpredicted measures covering workers’ wages to prevent them from being laid off amid the coronavirus fallout.
There is no high impacting IK economic data due for release today. Investors will continue monitoring the latest coronavirus updates and the potential for a full-scale lock down.
Swedish Krona Declines As Government Warns of 0.3% GDP Decline
The Swedish Krona trended lower across the previous week after the Riksbank took action to cushion the blow from coronavirus on the Swedish economy. The Swedish central bank rolled out a 500 billion krona loan plan to maintain credit to Swedish companies.
However, the Riksbank has been reluctant to cut interest rates after raising them out of negative territory for the first time in 5 years, in December last year. The central bank insists that it wants to see what fiscal stimulus measures the government will adopt before taking further monetary policy decisions.
With exports making up half of Sweden’s economy, the government has said that they expect the fallout from coronavirus to wipe around 0.3% of the GDP.
