EUR/SEK holds near 1-month high with focus on ECB

The EUR/SEK currency pair held near a 1-month high of 10.9695 on Wednesday, as investors braced for the outcome of the European Central Bank’s policy-setting meeting.

The European Central Bank is largely expected to lower its main refinancing operations rate by 25 basis points to 2.15% at its June 5th policy meeting. And, the ECB deposit facility rate is expected to be reduced to 2.00% from 2.25% currently.

In April, the central bank stressed on higher confidence that inflation was on track to return sustainably to the 2% target.

Euro Area’s annual inflation has eased to 1.9% in May from 2.2% in April and compared to economist estimates of 2%.

However, the ECB pointed out that the deteriorating outlook for the bloc’s economic growth remained a primary concern. The weakening growth forecast was largely attributed to escalating global trade tensions.

Market players will be closely watching ECB President Christine Lagarde’s press conference for any hints regarding future interest rate trajectory.

Meanwhile, SEK traders will also look to Sweden’s preliminary CPI inflation figures for May due out on Thursday.

The EUR/SEK currency pair was last up 0.25% on the day to trade at 10.9442.