Sweden: Negative inflation surprise – TDS

SEK trades broadly weaker after inflation data surprised sharply to the downside, analysts at TD Securities report. The EUR/SEK is sitting at 10.585. 

Key quotes

“Inflation surprised sharply to the downside in January, with the headline CPIF measure falling to just 1.2% y/y and the core CPIF Ex-Energy measure slipping to 1.6% y/y. The Riksbank had been looking for 1.4% and 1.9%, respectively.” 

“With much of the recent data showing a deterioration in Sweden, this should cause some concern at the Riksbank, but their strong determination to stay out of negative interest rates will likely over-ride any short-term worsening of the data.”