Nordea Warns of Downside Risks for NOK and SEK in the Short Term

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Nordea Warns of Downside Risks for NOK and SEK in the Short Term

According to a report from Nordea, the NOK and SEK are expected to remain the weakest currencies in the G10 sphere. Although both currencies could stabilize into the summer, economists warn that downside risks remain in place. The report also states that while both the Riksbank and Norges Bank will have to follow suit with the ECB and Fed to prevent further weakening of their currencies, this will likely not be enough to help the SEK and the NOK during periods of risk-off. Therefore, while the SEK and the NOK are expected to move broadly sideways until the summer, the risk is clearly to the downside.

Nordea's report suggests that a normalization of global interest rates should lead to a somewhat stronger SEK and NOK against the EUR in the longer term. However, the economists still see both currencies remaining weak in a historical context. This news could be concerning for investors who are holding these currencies or considering investing in them. It is important to monitor any developments in the global interest rates and any changes in the risk-off sentiment to make informed investment decisions.

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