Swedish krona dives on bigger than expected rate cut
July 4, 2014 7:41 am
The Swedish krona slid to a 3½-year low versus the euro Thursday following the country’s central bank lowered its main interest rate.
The Riksbank reduced borrowing costs for the first time in six months to bolster its sinking inflation rate, which fell short of its 2% target.
Sweden’s central bank said it would cut down its main repo rate to 0.25% from 0.75%. It also lessened its economic growth projections and did not anticipate to increase rates until the end of next year.
The krona tumbled by more than 2% to 9.358 against the euro, the lowest level since November 2010.
“The revisions to the [Riksbank’s] forecasts were very large, sending a particularly dovish message. We view the meeting as a lasting negative for the Swedish krona,” said Josh O’Byrne, Analyst at Citigroup.
The material has been provided by InstaForex Company – www.instaforex.com
The Swedish krona slid to a 3½-year low versus the euro Thursday following the country’s central bank lowered its main interest rate.
The Riksbank reduced borrowing costs for the first time in six months to bolster its sinking inflation rate, which fell short of its 2% target.
Sweden’s central bank said it would cut down its main repo rate to 0.25% from 0.75%. It also lessened its economic growth projections and did not anticipate to increase rates until the end of next year.
The krona tumbled by more than 2% to 9.358 against the euro, the lowest level since November 2010.
“The revisions to the [Riksbank’s] forecasts were very large, sending a particularly dovish message. We view the meeting as a lasting negative for the Swedish krona,” said Josh O’Byrne, Analyst at Citigroup.
The material has been provided by InstaForex Company – www.instaforex.com
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