British Pound to Swedish Krona (GBP/SEK) Exchange Rate Forecast; Sterling Lower after PMIs
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Although the UK’s upbeat report did help Sterling strengthen against several of its currency counterparts during European trading, the Krona outperformed its British rival during the session.
The Swedish Krona was bolstered after Services PMI for Sweden jumped markedly in July.
The measure rallied from 54.6 to 60.1, pushing further above the 50 mark separating growth from contraction.
The rate of expansion was the most considerable for three years.
A less volatile measure of the Swedish services sector, the nation’s three-month moving average, was also the best reading since mid-2011, coming in at 57.7. The result indicates economic growth of at least 0.7% on a quarter-on-quarter basis.
This surprisingly upbeat report may go some way to alleviating the concerns highlighted by Sweden’s Prime Minister at the end of July.
Sweden’s Prime Minister Fredrik Reinfeldt asserted that tepid export growth is weighing on the economy as a whole.
According to Reinfeldt; ‘What is weighing on us very clearly is the export numbers […] It is a hard global competition that Swedish industry and other export companies are living with. It’s about other countries’ demand for Swedish products. We have continuously highlighted the downside risks regarding exports and foreign trade as demand around us isn’t growing as many would hope.’
Initial estimates for Sweden’s second quarter growth saw the pace of expansion falling short of expectations.
The Pound Sterling to Swedish Krona (GBP/SEK) exchange rate hit a low of 11.5674 before returning to trade in the region of 11.5867.
Although Moody’s Investor Service (one of the top three credit rating agencies) cut its outlook for the UK’s banking sector, the Pound was supported by a stronger-than-anticipated Services PMI measure for July.
The UK’s services sector was performing at its best level for eight months.
Industry expert Lee McDarby had this to say of the Pound’s movement; ‘The markets always have their favourite currencies and 2014 has been a good year for the Pound. Unless central bankers get even more hawkish and UK data improves significantly, it is difficult to see Sterling’s strong run continuing indefinitely.’
Pound Sterling to Swedish Krona (GBP/SEK) Forecast
As the week continues the Pound Sterling to Swedish Krona exchange rate could fluctuate in response to the UK’s Industrial/Manufacturing Production figures and the nation’s growth figure for July.
As the week draws to a close Sweden’s industrial production data will be in the spotlight. Industrial Production declined by -3.2% in June, month-on-month, so investors will be hoping for a rebound.
The Pound Sterling to Swedish Krona (GBP/SEK) exchange rate is currently trading in the region of 11.5952.