The Pound is once again advancing versus the Swedish Krona on Tuesday, after having fallen lower versus the Krona in the previous session, snapping a three-session winning streak. On Monday the Pound sunk 1.5% against the Krona to close the session at 11.9543, marginally up from the low of the day.
At 06:45 UTC, GBP/SEK is trading at up +0.8% at 11.9886. The move higher comes after Prime Minister Boris Johnson implemented stricter measures to control the spread of coronavirus. Investors are looking ahead to the release of purchase manager index data later today.
PMI Data To Reveal Initial Coronavirus Impact
As the number of deaths caused by coronavirus jumped by 55 in just one day in Britain, the Prime Minister, Boris Johnson, finally took more serious steps to prevent the spread of coronavirus. Boris Johnson locked down the UK, in the biggest ever restriction on public freedom. The PM has banned people from leaving their house except for food, medical treatment, daily exercise or to travel to “essential work”. This is a move that will paralyse the British economy. The Pound had been expecting the Prime Minister to lock down Britain, dragging sterling lower across the previous session.
Today investors will look towards UK PMI data for both the UK manufacturing and dominant service sectors. This data is for March, so, it will give an idea as to how coronavirus is impacting the UK economy. Analysts are predicting that manufacturing PMI will drop to 45 in March, for 51.7 in February. The service sector activity will also decline to 45.2, down from 53.7. The figure 50 separates expansion from contraction.
Sweden Expecting Surge In Unemployment
The Swedish Krona gained in the previous on the news the Swedish government is preparing extra measures to dampen the effects of coronavirus on the economy. Economists suggest that up to 1.7 million Swedish workers could be made redundant as companies cut production. A record number of people have been told that they will be laid off in the coming two weeks. 18,367 people have received notice of termination so far in March, compared to 3292 across the whole of February. The details of what measure will be taken have not been released.
The Swedish economic calendar is relatively quiet with the next notable release, producer price index due on Wednesday.