Key Moments
- Societe Generale’s Kit Juckes highlights SEK as the currency most likely to gain from upcoming Riksbank, SNB, and Norges Bank decisions.
- Market pricing points to a 90% probability of a Riksbank rate hike in November, followed by another increase in the first quarter of next year.
- Consensus forecasts show Sweden’s GDP expanding 2.2% in both 2026 and 2027, exceeding projected growth in other major European economies.
Growth Advantage Underpins Positive SEK View
Kit Juckes at Societe Generale contends that the Swedish Krona (SEK) stands to gain from Sweden’s comparatively strong growth prospects and anticipated monetary tightening by the Riksbank. He notes that while subdued inflation is currently holding Swedish interest rates down, this is not expected to be a lasting constraint for the currency.
Juckes points to forecasts showing Sweden’s economy expanding by 2.2% in both 2026 and 2027, a pace that is projected to exceed growth in Norway and Switzerland. In his view, this sets the stage for a more constructive foreign exchange backdrop for SEK over time.
Monetary Policy Expectations and Market Pricing
According to Juckes, SEK is positioned to be the main beneficiary of forthcoming policy moves by the Riksbank, the Swiss National Bank (SNB), and Norges Bank. He notes that current market pricing assigns only a small probability to any action by the Riksbank in its next decision, but indicates a high likelihood of tightening later on.
He writes: “The SEK is the currency most likely to benefit from the decisions of the Riksbank, SNB and Norges Bank. The market prices only a remote chance of a Riksbank move tomorrow, but a 90% probability of a hike in November and a second hike in the first quarter of next year.”
At the same time, he stresses that the interest rate path is a more decisive factor for currencies than growth alone. For now, he observes that “Swedish rates remain subdued because of weak inflation,” while adding that “it is only a matter of time before the FX picture changes.”
European Growth Rankings: Sweden Out in Front
Juckes contrasts Sweden’s prospects with those of other major European economies based on consensus GDP forecasts. For 2026, he highlights that expectations put Sweden clearly at the top of the regional growth league tables.
| Economy | Consensus GDP growth forecast 2026 |
|---|---|
| Sweden | 2.2% |
| Switzerland | 1.3% |
| United Kingdom | 1.2% |
| Norway | 1.0% |
| Eurozone | 0.9% |
As he notes: “Consensus GDP growth forecasts for 2026 are 2.2% for Sweden, well ahead of the rest of Europe. Switzerland, with consensus growth of 1.3% next year, is the next best performer, followed by the UK at 1.2%, Norway at 1.0% and the Eurozone at 0.9%.”
Extended Outlook: Sweden Maintains Lead into 2027
The positive gap in Sweden’s projected performance continues into the following year, according to Juckes. He cites forecasts showing Sweden maintaining the same growth pace in 2027, while other European G10 economies trail at lower rates.
He writes: “The consensus GDP growth forecast for Sweden in 2027 is also 2.2%, while the next-best European G10 economies, Norway and Switzerland, are expected to grow by just 1.4%.”
Within this framework of higher expected growth and potential monetary tightening, Juckes argues that it is only a question of time before these fundamentals are more clearly reflected in the Swedish Krona’s performance.
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