With the Swedish economy likely to flirt with recession in Q3, a dovish shift by the Riksbank is well overdue. So, having been the worst performing G10 currency against the euro this year to date, the Swedish krona is likely to remain the laggard over the coming months. At the other end of the spectrum, we expect upward pressure on the Swiss franc to persist and to cause the SNB to step up its FX interventions. There is a rising chance that a rate cut comes before Q1 next year, which is when we currently have it pencilled in.
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