GBP/SEK Exchange Rate Falls as Sweden Benefits from Rising Oil Prices
The Pound Swedish Krona (GBP/SEK) exchange rate fell by -0.6% today and is currently trading around 11.9480kr on the interbank market.
The Swedish Krona (SEK) rose against the Pound (GBP) following better-than-expected Swedish inflation data, with the consumer price index (CPI) figures for May rising above the consensus 0.1% to 0.3%.
The annual CPI figures for May also increased above forecast, coming in at 2.2%.
Sweden’s economy has also benefited from the surge in oil and gas, which rose at 3.4%, benefiting Lundin Petroleum as global political tensions rise over the attack on the Japanese oil tanker in the Gulf of Oman.
John Hall, a Chairman of the consultancy Alfa Energy, said:
‘As a consequence the market has responded dramatically with an increase in the oil price of (as much as) four percent. How long it will hold for is another matter – and it has already fallen back slightly.’
Pound traders, meanwhile, will be awaiting today’s speech by Mark Carney, the Governor of the Bank of England, and with any dovish comments about the state of the UK’s economy, we could see Sterling sink further.
GBP/SEK Exchange Rate Sinks as Boris Johnson’s Hard-Brexit Stance Weighs on Sterling
Sterling has remained generally subdued, with focus remaining on the Conservative Party leadership race, following yesterdays’ parliamentary which saw Boris Johnson, a known hard-Brexiter, gain overwhelming favour with a 114 majority.
Boris Johnson, however, has come under increasing pressure to face his rivals in a televised debate, while concerns are also rising over Brexit, with Johnson’s notoriously hard stance raising concerns of a chaotic exiting from the European Union in October.
Cabinet Secretary Sir Mark Sedwill has exacerbated fears, and highlighted the increasing likelihood of a no-deal, who said that preparations for a chaotic exit were in ‘pretty good shape’.
He added:
‘A lot of this depends on choices made by the private sector and by third parties and will continue to do that work.’
Sterling, as a result, has remained down against many of its competitors due to no economic data releases.
GBP/SEK Outlook: Tory Leadership Campaigns to Remain in Spotlight
Sterling traders will be looking ahead to Monday’s UK inflation report hearings, and with any bullish comments about the state of the UK economy, this could prove GBP-positive.
Swedish Krona investors, meanwhile, will be looking ahead to Wednesday’s data releases, with Swedish unemployment and consumer confidence figures remaining in focus.
The Pound Swedish Krona exchange rate will be driven by political and geopolitical factors in the coming week, and with Brexit currently on hold as the Tory’s undergo their leadership campaigns, focus will likely remain on these developments.
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