The Swiss bank UBS has maintained its forecasts for the EUR/SEK pair and explained the reasons for the expected strengthening of the krona by the decline in global yields and energy prices.
The Swiss bank UBS Switzerland AG announced the continued strengthening of the Swedish krona against the euro. The main reasons were the decline in global yields and the fall in energy prices.
Bank strategists Clemence Dumonsel and Konstantin Bolts left their EUR/SEK pair forecasts unchanged. The expected levels are 11.00 in December, 10.90 in March 2027, 10.70 in June 2027, and 10.60 in September 2027.
The krona has been rising since September, and the EUR/SEK rate has fallen below the 11.00 mark. According to UBS, the decrease in global yields has eased pressure on low-yielding currencies, which include the Swedish krona. The fall in energy prices has removed another obstacle.
Sweden's economy remains resilient. The manufacturing sector shows leading dynamics, and confidence indicators point to steady growth.
The Riksbank has already raised the interest rate and is expected to do so again. UBS forecasts additional tightening of the regulator's policy next year.
The combination of the listed factors has improved the fundamental indicators of the krona. The bank sees the next key support level for EUR/SEK at 10.75, and resistance around 11.15.
The main risks to further strengthening are related to a possible rise in global yields or energy prices, as well as the possibility that the Riksbank may not carry out the expected rate hike.
