EUR/SEK tested 10.40 on steady Riksbank

• The Swedish Krona initially dropped to the 10.40 area vs. EUR.
• The Riksbank left unchanged the repo rate at -0.50%.
• The Nordic central bank signaled a rate hike in December or February.

The Swedish Krona has quickly depreciated vs. its European peer in the wake of the Riksbank meeting on Wednesday, lifting EUR/SEK to the 10.40 area although losing some momentum soon afterwards.

EUR/SEK keeps the rangebound theme so far

The cross is advancing for yet another session so far on Wednesday, although it remains submerged into the broader consolidative theme between 10.30 and 10.40 for the time being.

SEK dropped to the 10.40 region soon after the Riksbank left its repo rate unchanged at -0.50% at today’s meeting, in line with initial estimates, but managed to regain some buying interest later.

Matching consensus, the Scandinavian central bank is now expected to raise rates by 25 bp in December or February if economic conditions continue to support the prospects for inflation. Furthermore, the Riksbank reiterated that the domestic economic activity remains strong and consumer prices gyrate around the bank’s 2% target.

EUR/SEK levels to consider

As of writing the cross is gaining 0.19% at 10.3725 and a breakout of 10.3874 (high Oct.24) would expose 10.4453 (55-hour SMA) and then 10.5409 (high Oct.11). On the other hand, the next support is located at 10.2836 (low Oct.17) seconded by 10.2781 (200-day SMA) and finally 10.2273 (low Jul.30).