The Swedish krona lost against the euro and the dollar today after the nation’s central bank unexpectedly cut its benchmark interest rate and stated that the recession is deeper than predicted.
The Swedish currency hit a six-week low level after speculations rose that Latvia will devalue its currency, as an attempt to save the country from a deep recession, consequently affecting negatively loans held by Swedish banks in the Baltic Nation.
The Swedish krona advanced it’s yearly low levels against the U.S. dollar today as the country’s central bank surprised the market participants with the biggest rate cut in the last 16 years to prevent the economy from contracting.
Swedish central bank left the main interest rate unchanged at 4.00% during the meeting of the Executive Board on 18 December.
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