EUR/SEK settles above 7-week low, posts weekly gain

The EUR/SEK currency pair settled above recent low of 10.7874, its weakest level since April 4th, as market players digested a flurry of European macro data.

In Germany, retail sales shrank 1.1% in April, recording the first decline in four months, against expectations of a 0.2% growth.

At the same time, easing inflation pressures in Euro Area’s largest economies prompted investors to boost their bets the European Central Bank will lower interest rates at its upcoming policy meeting and likely deliver more cuts afterwards.

In France, annual consumer inflation dropped to 0.7% in May, preliminary data showed, or the lowest rate since February 2021.

In Spain, annual CPI inflation eased to 1.9% in May, or the lowest rate since October 2024.

In Italy, annual CPI inflation eased to 1.7% in May, the lowest rate since February.

And, German annual CPI inflation remained stable at 2.1% in May, or the lowest rate since October 2024.

Meanwhile, the latest data out of Sweden showed the economy had contracted 0.2% quarter-on-quarter in the three months to March 2025, against market consensus of a 0.1% growth and stagnant preliminary estimates.

It has been the first contraction since the fourth quarter of 2023.

Swedish central bank Deputy Governor Per Jansson said this week the Krona’s recent strength was a result of concerns over US tariffs and other policies and was not likely to be reversed in the short term.

Investors also weighed news that a US federal appeals court issued a temporary halt to a recent tariff ban on the Trump administration’s tariff policies.

The EUR/SEK currency pair settled 0.22% higher at 10.8768 on Friday.

The exotic Forex pair gained 0.47% for the week.