SEK: October inflation unlikely to give Riksbank cause for optimism - Nomura

Research Team at Nomura, suggests that the current EUR/SEK levels may look attractive for short positions but Nomura suggests near-term caution, as there is little to change the Riksbank’s recent dovishness into year-end.

Key Quotes

“October’s CPI reading (released Tuesday) looks set to disappoint the Riksbank forecast. A second consecutive inflation disappointment could lead the market to price a possibility of a Riksbank cut. The impact of the Trump win on SEK, on balance, is likely positive. We are cautiously looking for a good re-entry point for EUR/SEK short positions, but a clearer inflation recovery will be necessary for the Riksbank to become hawkish.”