Riksbank likely to stand pat in December meeting

Sweden's Riksbank is expected widely to keep its policy rate on hold in its upcoming policy meeting tomorrow, but retain an easing bias.

Disappointing ECB meeting and "higher-lower-bound" prospects in EA rates, have abated the shot term pressure for the central bank of Sweden, contrasting the previous anticipations.

".. we no longer expect a 10bp rate cut and instead think the Bank will adopt a "wait-and-see" stance as it assesses potential future policy actions by the ECB", says Barclays in a research note. 

This policy decision of the bank should be assisted by solid domestic data, along with the bank focusing on the inflation trend rather than last week's CPI print, which was weaker than expected.

The Swedish market is expecting a 40% chance for a cut, with which the "hold" decision should support SEK, which is currently trading at 9.35 versus EUR, and at 8.52 against USD.