USD/SEK: Sweden’s S&P Rating Stable in Lieu of GDP Growth
- S&P Holds Rating Steady ‘AAA/A-1+’
- GDP increases 0.7% in Second Quarter
- USD/SEK Bullish Trend Continues
Today, Standard and Poor affirmed Sweden’s rating of ‘AAA/A-1+’ upon its conclusion of a stable economic outlook.
As reported by Statistics Sweden, second quarter GDP growth increased 0.7% over the first quarter and 2.6% compared to the same quarter a year ago. Much of this growth can be attributed to the increase in household expenditures (+3.2%), capital formation (+3.7%) and exports (+1.5%) over the same time span.
Additionally, The Riksbank’s decision to keep rates low at 0.25% until inflation levels rise will help stabilize the economy as global recovery continues to take place at varying rates. While slow recovery in the Euro Area has allowed the Krona to have short periods of appreciation against the Euro, a strong U.S. recovery has led the SEK to depreciate 16% against the USDollar since June.
EUR/SEK – prices have been in an upward sloping price channel since 2013. There are a series of wave relationships and resistance levels near 9.26 - 9.30. Prices are having a tough time pushing through these levels. The support trend line near 9.10 could offer support. A meaningful break above 9.30 could send prices higher.
USD/SEK is approaching levels not seen in 4 years. The previous high of 7.33 is also at the 61.8% Fibonacci retracement of the 2010-2011 downtrends. Currently, the USDollar strength is overcoming resistance levels so a break higher would likely continue the trend towards 7.50-7.60
Daily USD/SEK Chart
Graph Created By Jeremy Wagner Using MarketScope2.0
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