Summary:
- Sweden’s opposition party sparks political chaos as it intends to hold anti-euro membership referendum
- SEK among largest losers in G10, much of a decline has already disappeared though
The Swedish krona is trading lower on the day after an opposition party, known for its anti-euro stance, said it would call for a referendum on the country’s European Union membership after general elections in September. The krona dipped in the morning as USDSEK jumped to above 8.85 while EURSEK crossed 10.27. However, almost all of these moves have been pared since then while traders have digested political risks ascribing them not too much probability.
Start investing today or test a free demo
Open real account TRY DEMO Download mobile app Download mobile appThe Sweden Democrats (an anti-immigration group) leader Jimmie Akesson said that Sweden pays an incredible amount of money and gets incredibly little in return. However, even as traders have become understandably spooked but anti-European remarks such a scenario appears to be highly unlikely, and this view is shared quite commonly among Sweden’s financial institutions. It’s also worth mentioning that the ruling coalition of Prime Minister Stefan Lofven is unlikely to get a smooth victory in September’s elections according to polls. In order to reassure investors Swedish foreign minister Margot Wallstrom tweeted that leaving the EU "would hurt Sweden and lead to insecurity for ordinary people. In today’s uncertain world, more cooperation is needed, not less". Moreover, according to polls carried out among Swedes from time to time they keep opting for staying within the EU. Now, it’s the parliament turn whether to hold a referendum or not. Just calling for a vote demands 35 vote according to the country’s constitution, but to vote in favour of a referendum demands as much as 117 lawmakers. The Sweden Democrats holds currently 42 out of 349 seats in the parliament.
A technical view seems to still favour sellers looking at a daily time frame. Notice the price drew two bearish candlesticks over the past weeks, therefore until it hovers below this levels further declines appears to be a base scenario. Source: xStation5
Our premium analysis on USDSEK might be found here.
Disclaimer
This article is provided for general information purposes only. Any opinions, analyses, prices or other content is provided for educational purposes and does not constitute investment advice or a recommendation. Any research has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Any information provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it.
Start investing today or test a free demo
Open real account TRY DEMO Download mobile app Download mobile appPast performance is not necessarily indicative of future results, and any person acting on this information does so entirely at their own risk, we do not accept liability for any loss or damage, including without limitation, any loss of profit, which may arise directly or indirectly from the use of or reliance on such information.
