- USD/SEK price nears its ATH.
- Swedish consumer inflation climbed towards the highest mark since 1991.
- The pair might keep rising despite massive Swedish inflation numbers.
USD/SEK sees its price approaching its ATH ahead of Fed’s upcoming rates decision. However, the recent Swedish CPI data had the pair rising to 10.15, hitting its highest mark since 1 April. It has gained over 75% from the lowest zone in 2011. Meanwhile, EUR/SEK climbed to 10.60, the highest mark since 12 May.
Swedish Consumer Inflation
Sweden sees its economy struggling as the nation continues with its plans to join NATO. The nation’s statistics agency show inflation advanced towards the highest mark since 1991. Meanwhile, the headline consumer index increased to 7.3%, higher than the 7.0% median estimate. Moreover, it exceeded the 6.4% previous jump.
The consumer price index hiked to 1.0% from 0.6% on MoM (month-on-month) basis. That came as energy and food witnessed continued price surges. For now, the Riksbank can maintain a more hawkish stance in the upcoming months. The bank introduced a 0.25% rate hike in April and promised 2 to 3 hikes this year.
Analysts trust the central bank will resort to multiple 0.50 rate surges in the upcoming months, citing ongoing surging inflation. USD/SEK will respond to the imminent rate decisions. Financial experts expect the bank to hike rates by 0.50% following the Swedish inflation upsurge to 8.6%, a 40-year peak.
According to the 4-hour chart, the USD-SEK price maintained a massive bullish bias within the past couple of months. For now, the pair moves towards its record high. Moreover, USD/SEK approaches the ascending channel’s topside boundary.
Moreover, the pair ascended beyond the 25- and 50-day MAs, whereas the Relative Strength Index climbed past the 50-neutral. Thus, USD-SEK retained a bullish outlook, with bulls eyeing the resistance zone at 12.
Inflation remains a challenge in the financial world, with market players fearing an impending recession. Central banks have adopted a hawkish stance, raising interest rates to curb inflation. It may be interesting to see what upcoming monetary decisions by central banks would mean for the markets.