Scandies between oil and central banks – Danske Bank

Arne Rasmussen, Head of FI Research at Danske Bank, has given his views on SEK and NOK in light of the recent price action.

Key Quotes

“In Sweden, the EUR/SEK fell further yesterday after the Riksbank’s Jansson's comments admitting that monetary policy has its limits (this is somewhat of a new signal from one of the most dovish policy committee members). In particular, he admitted that there are limits to how much can be done via the exchange rate. We may see the EUR/SEK move lower, especially if the ECB comes out on the dovish side”.

“Given the continuing slide in oil prices, we see upside risk for the EUR/NOK although the NOK has remained fairly strong amid relatively positive global risk environment. The NOK is also traditionally trading on a weak note in the last weeks of the year, which should soon start to provide upward pressure on EUR/NOK in our view, unless the ECB strikes a very dovish tone today”.