ING forecasts further downside for EUR/SEK to 11.15, citing a hawkish Riksbank stance and a dovish repricing of ECB expectations, while noting that EUR/USD remains relatively cheap.
The EUR/SEK pair is experiencing downward pressure, having declined 1.8% from its October peak due to a combination of French fiscal instability and a shift in central bank policy expectations. ING analysts note that the pair has moved from an overvalued state to fair value, with the Riksbank's hawkish stance contrasting against a dovish repricing of the European Central Bank's outlook, supporting a target of 11.15.
ING has set a one-month target of 11.15 for the EUR/SEK pair.
The pair is considered fairly valued following a 1.8% decline from its early-October high, which corrected its previous short-term overvaluation.
ING notes EUR/USD is cheap but provides no specific forecast, only a comparison to EUR/SEK valuation.
ING analyst Francesco Pesole projects the EUR/SEK pair to decline toward 11.15 in the coming month. The forecast follows a 1.8% drop from October highs, driven by shifting Riksbank policy expectations and lingering French fiscal concerns.
ING expects further downside due to the Riksbank signaling a potential rate hike in November, coupled with a dovish shift in ECB expectations and ongoing fiscal concerns in France.