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FX Steady, 10Y SGBs Eye Highest Yield Since 2011

SCANDIS

Scandi FX largely steady on the day, with local headline flow light alongside the Eurozone.

  • Modest stabilisation of market sentiment (with EURUSD and European equities off weekly lows) is yet to buoy high beta Scandi FX. NOK/SEK sits below the 200-day EMA at 1.0219, with 1.0121 (July 18 low) the next supportive level.
  • EURNOK hovers around the 11.40 handle, which was a key support over August and September, and held despite Norges Bank's commitment to another rate hike this year.
  • 10-Year SGBs underperform German counterparts this morning, with yields approaching 3.104% (Sep 28 high and highest since 2011). The 10-Yr Bund/SGB spread sits 4.5bps wider on the day at 16.1bps amid broader FI weakness.
  • Tomorrow, Sweden's services PMI will be of interest, particularly given Riksbank members' (in particular Deputy Gov. Breman and Gov. Thedeen) concerns with services inflation evident in the September minutes yesterday.

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