Sweden: Reading The Markets

 | Mar 15, 2013 07:53AM ET

  • The krona is not a restriction for Riksbank rate hikes unless it embarks on a relatively fast appreciation.
    • Labour market data (so far) has behaved better than feared, both by us and the Riksbank.
    • Long end underperformance over for now.
    Trades
    New

    : Buy 10JUN, sell 2JUN against BundJun and SchatzJun in a curve box at -41bp. P/L: -60bp/-25bp.

    Profit taken: ASW box, sell SGB1054 ASW vs SHYP1576 ASW in a ASW box. Profit: +8.5bp.

    Profit taken: Pay 15y SEK vs Rec 15y EUR. Profit: +4bp.

    Loss taken: Sell SGB1054 ASW. Loss: -2.5bp.