Sweden’s Riksbank is set for minimal policy tightening through 2027, sharply diverging from European Central Bank expectations, according to Nomura strategists. The Swedish central bank is projected to maintain its current policy rate unchanged throughout 2026 before delivering a single 25 basis point hike to 2.00% in early 2027.
This conservative hiking stance contrasts starkly with anticipated ECB monetary policy trajectory, highlighting growing policy divergence within the European monetary landscape. The limited tightening cycle signals Nomura’s view that Swedish economic conditions will remain subdued compared to the broader eurozone, potentially reflecting weaker inflation pressures or growth concerns specific to Sweden’s economy.
Currency traders should watch for sustained SEK weakness against the euro as rate differentials widen. Fixed income markets may see Swedish government bonds outperform eurozone peers as the Riksbank maintains its dovish posture while the ECB potentially moves more aggressively.
FXnCO Insight
EUR/SEK could see extended upside through 2026 as the policy gap between Frankfurt and Stockholm widens, creating tactical opportunities for rate differential trades.
Source: FXStreet