In Sweden, the week ahead contains only the labour force survey where we expect another lacklustre outcome demonstrating still high unemployment rates and softer employment growth.
We expect decent demand at the SEK4bn tap of the SGB 1058 (May 25 3.0%) on Wednesday. The last tap of the bond had a bid-to-cover of 2.8 and we see no reason why this one should be any weaker given the positive (although low outright) level as well as pick-up to core EU. The Swedish National Debt Office will also introduce a new 17-year inflation-linked government bond through syndication this week. The new bond will be introduced solely through a switch.
Oil prices have risen in the past week, and the NOK has followed suit. The import-weighted NOK exchange rate is now marginally stronger than Norges Bank had assumed in the March monetary policy report, which could, in principle, mean a greater chance of a rate cut in May. However, according to our short-term financial models there is a clear risk of a temporary correction higher in EUR/NOK.
We expect Norges Bank to announce today that it will sell another NOK3-4bn in the second tap of the new 1.75% Mar '25 (NST 477) bond on Wednesday 22 April. We look for strong demand yet again, just as we saw when the bonds were introduced in March.
In Denmark the coming week brings consumer confidence data for April.
Otherwise, focus will continue to be on EUR/DKK that last week once again started to edge lower after trading at its highest levels since end-March 1999. The move lower likely reflects the fact that the "dividend season" for Danish-listed companies is now more or less over. Uncertainty regarding the Greek debt situation and the impact from the ECB's bond purchases might also have supported DKK recently.
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