SEK hit by weak CPI, but price trend still higher - BNPP

Research Team at BNP Paribas, notes that the SEK continued to sell off Tuesday, with EURSEK breaking above 9.70 for the first time since December 2014.

Key Quotes

“The weakness came in the aftermath of softer September CPI data from Sweden, which our economists note will likely be viewed with some disappointment by the Riksbank. However, Riksbank Deputy Governor Ohlsson noted that the central bank focuses more on the trend in CPI, which he emphasized was still upward. We were stopped out of our short EURSEK recommendation this week but continue to expect the cross to be substantially lower by the end of this year and continue to see risk-reward as very attractive to position for downside in the cross.”