Pound Sterling Swedish Krona (GBP/SEK) Exchange Rate Edges Higher as Sweden Warn of Second Wave
The Pound Sterling Swedish Krona (GBP/SEK) exchange rate rose by around 0.4% on Tuesday. This left the pairing trading at around 11.5890kr.
The Swedish Krona edged lower on Tuesday after data revealed May’s annual Swedish industrial production slumped by -16.5% in May.
Monthly production edged lower, slipping by a worse-than-expected -0.1% after plummeting by -16.4% just a month earlier.
May’s new orders also did not provide the currency with any relief as orders tumbled by -18.4%. This followed a downwardly revised 20.6% slump and was the third consecutive fall.
Meanwhile, SEK also remained under pressure after Sweden’s government warned authorities to prepare for a potential second outbreak of the coronavirus pandemic.
Speaking during a press conference, Sweden’s Health Minister, Lena Hallengren announced plans for how the country should act if there is a resurgence in cases.
‘The danger is not over. That’s why it is important to have regional plans, not just national.’
Sterling (GBP) Rises Ahead of Sunak’s Budget Speech
The Pound edged higher against the Swedish Krona today as markets awaited further details on how the British government would support the economy.
Wednesday will see Chancellor Rishi Sunak make a speech about spending, with further measures to support the economy likely. Just seven days ago Prime Minister Boris Johnson announced £5 billion worth of infrastructure investment.
The Guardian also noted that the Chancellor is considering handing out vouchers of £500 for children and £250 for children to spend in sectors hit the hardest by Covid-19.
In a note, analysts from Brown Brothers Harriman wrote:
‘Prime Minister Johnson’s so-called New Deal for infrastructure spending was deemed insufficient and so UK business interests are urging Sunak to be more aggressive.’
However, despite recent GBP gains, investors continue to remain cautious about the outlook for the currency.
Trade negotiations between the European Union and UK still remain in focus as both side try to reach and agreement in negotiations.
Pound Swedish Krona Outlook: Post-Brexit Trade Talks in Focus This Week
Looking ahead to Thursday, the Swedish Krona (SEK) could make some gains against the Pound (GBP) following the release of May’s household consumption data.
If Sweden’s household consumption rebounds in May, it could offer the Krona a boost as it shows consumers are becoming increasingly confident.
However, this could be offset by upbeat post-Brexit trade talks between the United Kingdom and European Union.
If reports reveal that trade talks between London and Brussels are progressing successfully, it will send the Pound Swedish Krona (GBP/SEK) exchange rate higher.