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Sweden sets off a very busy week in terms of central bank activity.
Following quadruple witching day on Friday, we ought to expect a rather volatile week of trading ahead of the quarter’s close.
This is especially true for the non-central currencies, which might come under extra strain.
Here’s what some of the central banks are up to.
Sweden to Stay the Course
The COVID outbreak has merely exaggerated a problem Sweden’s Riksbank was already dealing with unsuccessfully.
Like most currencies outside of, but intimately tied to, the euro, inflation has been chronically below target, with no expectation of it coming back into line.
Comparatively, the krona remains “too strong” for the likes of policy-makers. However, despite prolonged negative interest rates, that hasn’t changed.
Today, the Swedish government announces a special budget to deal with the effects of COVID.
The extra spending might finally raise some expectations for increased inflation. But...
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