SEK has weakened following the Riksbank decision, as the Executive Boards adds optionality to cut “two or three” more times in the remainder of 2024 (versus just two times in the May guidance).

• Our preliminary calculations suggest that the revised rate path assigns around an 85% chance of a rate cut in August.
• Though the Riksbank’s “gradual” approach to policy means that a September cut will likely depend on the inflation data released in the meantime.
• The FX moves have been reasonably contained though, with EURSEK only 0.36% higher pre-decision levels and NOKSEK around 0.3% higher.