Soft domestic data and mildly dovish Riksbank April meeting to keep SEK under pressure - ING

"With the case for the Riksbank to facilitate SEK strength sharply diminishing and the Riksbank rather facing a puzzle of how to prevent SEK weakness in the low growth and low domestic inflation environment, we look for more SEK weakness to come in the months ahead," note ING analysts and add: "The soft domestic data and mildly dovish Riksbank April meeting should keep SEK under pressure."

Key quotes

"After reaching our 1-month target of EUR/SEK 10.60 today, we revise our EUR/SEK forecast higher and look for EUR/SEK to reach 10.75 in 3 months – that is a new post-financial crisis high. We also upgrade our 12-month forecast to 10.30, though our conviction is much higher for the three months view. We remain firmly bearish on the currency and continue to struggle to find good reasons (bar valuation) to own the krona."

"We recognise that the currency currently looks oversold on a short term basis, be it based on the relative strength index or our short-term financial fair value model (as per Figures 7 and 8). Hence, some EUR/SEK stabilisation over the near term is likely before renewed appreciation in the second quarter this year."