Swe­den's growth re­bounds af­ter mon­e­tary stim­u­lus

The Pak Banker - - BUSINESS -

Swe­den's krona rose to a seven-week high ver­sus the dol­lar as the gov­ern­ment boosted ex­pec­ta­tions for growth fol­low­ing months of in­ter­est-rate cuts and stim­u­lus. The Scan­di­na­vian cur­rency ad­vanced ver­sus all 16 of its ma­jor peers as the Fi­nance Min­istry said the na­tion's econ­omy would ex­pand 2.8 per­cent this year and next, ex­ceed­ing a June forecast for 2.6 per­cent growth in 2015 and 2.7 per­cent in 2016.

The Swedish cen­tral bank has slashed in­ter­est rates to an un­prece­dented low and un­veiled a pro­gram of bond pur­chases as it looks to boost growth and get in­fla­tion back on track. Both seem to be re­viv­ing, with Riks­bank First Deputy Gover­nor Kerstin af Jochnick say­ing in­fla­tion is de­vel­op­ing in line with fore­casts. "The over­all growth pic­ture we see as pos­i­tive," said Ian Stan­nard, head of Euro­pean for­eign-ex­change strat­egy at Mor­gan Stan­ley in Lon­don. "Some up­beat com­ments from Jochnick have prob­a­bly helped as well. We have high­lighted the krona as likely to be an out­per­former."

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