Swedish krona rises against majors on GDP and retail sales data surprise

The Swedish krona rallied across the board on Friday, 27 February, as GDP and retail sales data from Sweden surprised on the higher side.

The Swedish economy expanded 2.7% from a year earlier in the fourth quarter after recording 2.3% in the third quarter and against the market expectations of a decline to 1.5%.

On a quarterly basis, the growth rate increased to 1.1% from 0.45% while analysts had been expecting a repeat of the Q3 figure.

The USD/SEK fell to 8.3076 from the previous close of 8.4046 and against the pound, the Swedish unit dropped to a nine-day low of 12.7838 from the previous close of 12.9473.

The EUR/SEK slipped to a three-week low of 8.3212 from the previous close of 8.4112. Friday's move added to the losses in the cross after Thursday's (26 February) ECB action.

The ECB has launched a bond buying plan that would increase the total monthly fund injection to €60bn ($67.28bn, £43.56bn). The single currency plunged across the board as the monetary expansion was more than expected.

Another set of data from Sweden showed that retail sales in the country grew 5.1% from a year earlier in January from 3.3% in the previous month when the consensus was for a smaller increase to around 4%.

Month-on-month, the retail sales growth rebounded to 1.2% from a 0.6% decline in December while the market was expecting a growth of 0.5%.

In addition, the Swedish PPI rate rose to 0.2% from -0.1% in December on a yearly basis and from -0.3% to 0.2% on a monthly basis.

Against the Norwegian krone, the Swedish unit rose to a three-week high as data from Norway was disappointing even as the neighbour surprised on the higher side. Retail sales in Norway fell 0.7% in January after growing 0.2% in December, as per official statistics.

The NOK/SEK slipped to 1.0864, its lowest since 6 February, from the previous close of 1.0976.