Where are we heading? Our main scenario is that data will improve and rates move somewhat higher on a three-month perspective. However, right now our rate of conviction regarding the direction of rates is relatively low. From a portfolio perspective, we therefore extend duration from -0.5 years previously to neutral (OMRX bond index). We have an overweight of mortgages with 2016-18 maturity.
What does the data tell us? The most recent Swedish macro data failed to impress and unlike in the US and Euroland, the Swedish surprise index has declined again. The latest business and consumer confidence survey gives a mixed impression with unexciting current conditions but increasingly optimistic future assessments.
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