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Sweden’s Economy Might Shrink 4%, USDSEK Rebounds

USDSEK
USDSEK

USDSEK trades higher for the second consecutive session after disappointing forecasts about the Sweden economy. Finance Minister Magdalena Andersson said that Sweden’s economy might shrink 4% this year as the coronavirus spread hits demand and supply. Andersson said that the downturn this year is expected to be nearly as deep as during the global financial crisis in 2009 when Sweden’s economy shrank 4.2%, the biggest decline in over 50 years. 

Fed announced earlier the launch of another temporary facility to provide US Dollar liquidity to foreign central banks. The foreign central banks’ holdings of US Treasury’s can be exchanged for dollars.

Riksbank announced the previous week an extension of the quantitative easing programme and unlimited liquidity. The extended new programme includes government bonds, local government bonds, as well as covered bonds.

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USDSEK Technical Evaluation

USDSEK is on the bid today across the board, and is adding 0.75% at 10.0852 as the recent correction from all-time highs stalled at 9.8455. The technical outlook is bullish for USDSEK despite the recent six day’s correction and an attempt to new highs can’t be ruled out.

On the upside, first resistance will be met at 10.1340 the daily high. A move above, would attract more bids for an attempt to the next resistance level at 10.1589 the high from March 26th. More offers might emerge at 10.2078 the high from March 25.

On the other side, the initial support for the pair stands at 10.0017 the daily low. The next support might emerge at 9.88780 the March 30th lows. Next support stands at 9.8400 the recent low.