EUR/SEK flirts with 7-week lows near 10.7700

• EUR/SEK tumbles to multi-week lows near 10.7700.
• The Riksbank left the repo rate unchanged at 0.00%.
• Sweden Retail Sales contracted less than expected in March.

The Swedish krona is appreciating further on Tuesday and is dragging EUR/SEK to fresh multi-week lows in the 10.77 neighbourhood.

EUR/SEK offered post-Riksbank, data

The krona has picked up extra pace after the Riksbank left the repo rate unaltered at 0.00% at Tuesday’s meeting, widely in line with market expectations. In addition, the Nordic central bank left no clues regarding the timing or the direction of the next move on rates, although the rate path hints at no such a move in a 12-month’s horizon.

The Board, however, stressed that remains ready to act in case of need and could use all available tools.

Further out, the Riksbank unveiled two possible scenarios to assess the impact of the coronavirus pandemic on the economy. In both of them there is a sharp contraction of the economic activity of nearly 7% and just below 10%, anual inflation easing to 0.6%  and unemployment ticking higher to 8.8% and above 10%.

In the domestic docket, Retail Sales contracted at a monthly 1.7% during March, not as bad as forecasted although reversing February’s 0.2% expansion. Additional data saw the trade surplus shrinking to SEK 4.10 billion (from SEK 12.7 billion) during the same period.

EUR/SEK levels to consider

As of writing the cross is retreating 0.65% at 10.7626 and a break below 10.6837 (200-day SMA) would expose 10.4847 (monthly low Mar.3) and finally 10.4497 (2020 low Jan.3). On the flip side, the next resistance lines up at 10.9746 (weekly high Apr.21) seconded by 11.0327 (monthly high Apr.6) and then 11.3520 (2020 high Mar.19).