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SocGen See NOKSEK Delivering Safer Gains Ahead

SCANDIS
  • SocGen write that buying NOK/SEK could deliver safer gains ahead, and express the view via long NOK/SEK at 0.97, targeting 1.04 with a stop at 0.9550.
  • They see both currencies as vulnerable, but Sweden faces deeper woes and NOK/SEK is strongly undershooting its relative fundamentals. As such, they think that 0.95 was probably the bottom for the cross.
  • Sweden is facing much higher inflation, severely weighing on its growth prospects. Swedish residential prices have plunged 20%, with a real estate crisis there threatening the economy (and limiting the Riksbank’s room for manoeuvre)
MNI London Bureau | +44 203-865-3809 | edward.hardy@marketnews.com

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