Nordea writes "NIRP is on the radar........>

EURO-SEK: Nordea writes "NIRP is on the radar again in Sweden as well, at least

if the SEK gains from current levels. Floden from the Riksbank has mentioned

several times that a (too) strong SEK would be the most obvious excuse to go

back to negative interest rates. A doubling of the QE pace has been pondered

ahead of the April 28th meeting, but a cut would be the final nail in the coffin

for the otherwise relatively stable SEK. The outcome space for EUR/SEK over the

coming 1-2 quarters is skewed to the upside in our view. Should EUR/SEK drop

3-4% from current levels, we would expect a cut to become likely, which can be

seen as a de facto floor for EUR/SEK. "If SEK gains, then we will cut." We go

long EUR/SEK with a target of SEK11.25 and a stop loss at SEK10.66 in

anticipation of Krona-negative Riksbank news later this month. The Swedish

corona strategy is unlikely to become a driver of SEK by now unless Sweden

suddenly ends up with more draconian lockdown measures."