EUR/SEK still a ‘buy on dips’ – Danske Bank

Chief Analyst at Danske Bank Arne Rasmussen suggested any dips in the cross could be seen as buying opportunities.

Key Quotes

“Mr Ingves’ ’no-news’ comment on inflation being on target had no lasting impact on EUR/SEK. It was an overreaction, in our view, also because it is only partly true given that core inflation (CPIF ex energy) is still below target and soon heading lower in our view”.

“Now, with the Swedish housing developers starting to release year-end reports, we think that focus in the SEK market will turn back to these issues. What are the tendencies? On Thursday, JM reported a substantial (20%) drop in sales while production starts slowed as well. On Friday, we turn our eyes toward the Q4 report from Bonava, another key operator in the housing sector”.

“Signs of weakness would bolster our bearish view on the krona. We continue to see EUR/SEK as a buy on dips”.