EURSEK Euro vs Swedish Krona

The Swedish Krona declined sharply against the U.S. dollar and the euro in European morning deals on Wednesday, after Sweden's central bank kept its key rate unchanged, while extending its quantitative easing program due to considerable uncertainty in global economic outlook.

The bank retained its repo rate at -0.35, as widely expected by economists. The rates will be effective from November 4.

The Executive Board has decided to extend the government bond purchasing programme by an additional SEK 65 billion, taking the total purchases to SEK 200 billion by the end of June 2016.

"There is still considerable uncertainty regarding the strength of the global economy and central banks abroad are expected to pursue an expansionary monetary policy for a longer time," the bank said.

The Riksbank also indicated willingness to intervene on the foreign exchange market if the upturn in inflation should be threatened as the result of a problematic market development.

The Krona depreciated to a 6-day low of 9.4321 against the euro, reversing from a 2-day high of 9.3609 hit immediately after the decision. The Krona is seen finding support around the 9.42 region.

At the same time, the Krona fell to more than a 2-month low of 8.5444 against the greenback, down from its early 5-day high of 8.4651. The Krona is likely to challenge support around the 8.6 mark.

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