Anna 
UBS, a prominent financial institution, has revised its stance on the Swedish Krona (SEK) to adopt a moderately bearish outlook following recent developments from the Riksbank, Sweden’s central bank, which lowered interest rates.
The bank has adjusted its forecast for the EURSEK exchange rate, now predicting it to reach 11.80 by the end of the second quarter, 11.90 by the end of 2024, and 11.60 by the end of 2025. This shift represents a departure from previous targets of 11.30, 11.10, and 10.75, respectively.
Several factors underpin UBS’s revised outlook on the SEK, including concerns over accelerating imported inflation and the SEK’s vulnerability amidst the strength of the US dollar and policy divergence compared to the European Central Bank (ECB).
In contrast, UBS maintains a more positive outlook on the Norwegian Krone (NOK) following a review of Norway’s budget revision. The bank considers the update as mildly supportive for the NOK, thus retaining its end-of-second-quarter target for the EURNOK exchange rate at 11.70.
UBS has also proposed an investment strategy for those interested in the NOK versus the SEK, recommending buying NOKSEK on dips to 0.9850, setting a target of 1.0260, and a stop loss at 0.9720. This strategic guidance is informed by UBS’s assessment of the Norwegian budget revision and its implications for the NOK.
