Turn Weaker Following Poor EZ PMIs

After benefitting from a conducive risk environment in early trade, Scandis have weakened following a bounce back in the USD and poor PMI numbers out of the Eurozone.

• EURSEK 0.2% higher on the day while USDSEK sits 0.6% higher - the former sits just above the 50-day EMA at 11.6937. EURNOK trades 0.1% lower on the day, while USDNOK is 0.3% higher.
• Prepared remarks from Riksbank Governor Thedéen noted that the reduction in the prices of bonds purchased during the Riksbank's QE programme from 2015-2021 have resulted in unrealised losses on the balance sheet.
• They did not contain statements on the future policy outlook, but Thedéen stressed the Riksbank requires a SEK80bln capital injection to restore equity to a basic level.
• From the release: “A negative equity does not affect the Riksbank’s ability to conduct monetary policy in the short term. But to maintain confidence in an independent monetary policy in the long term, it is necessary that the Riksbank is financially independent, that is, has sufficient equity and earnings to cover its costs".
• The remainder of today's calendar is light, but Swedish PPI tomorrow may attract some attention given First Dep. Governor Breman's remarks in recent weeks (r.e. the Riksbank looking at upstream price dynamics in advance of the November meeting).