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EUR/SEK jumps near 9.3500

FXStreet (Edinburgh) - The Swedish krona is rapidly depreciating vs. its European counterpart on Tuesday, lifting EUR/SEK to fresh high near 9.3500.

EUR/SEK stronger post-Riksbank

The cross is navigating fresh multi-month highs around 9.3400 following the rate cut by the Riksbank, taking the repo rate to 0.0% from 0.25%. Despite the move was quite priced in by the markets, the central bank’s decision still managed to surprise investors. The Riksbank said the Swedish economy is growing as expected although deflationary fears seem to have been behind the decision. Stefan Mellin, Senior Analyst at Danske Bank, observed, “Fundamental arguments like the current account surplus, solid public finances, relative inflation, relative growth suggest that the SEK is significantly undervalued”.

EUR/SEK relevant levels

At the moment the cross is up 0.78% at 9.3334 with the next resistance at 9.3900 (multi-year high Jul.3) ahead of 9.4150 (high Nov.22 2010) and then 9.4280 (high Nov.17 2010). On the downside, a breach of 9.2810 (high Oct.27) would open the door to 9.2366 (38.2% of 9.0555-9.3485) and finally 9.2020 (50% of 9.0555-9.3485).

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