Swedish Krona Slides as Manufacturing Expansion Slows on OrdersJohan Carlstrom
Sweden’s krona declined after a report showed an expansion in manufacturing slowed more than estimated last month, adding to speculation the central bank will again lower interest rates.
The krona slid as much as 0.6 percent to 9.2357 per euro and dropped 0.6 percent to 7.0346 per dollar. A report showed the Swedbank AB purchasing managers’ index fell to 51 for last month, down from 55.1 in July and below the 54.8 estimated in a Bloomberg survey.
Swedish central bank policy makers meet this week and are predicted to keep their benchmark rate unchanged at 0.25 percent. The bank in July cut its main rate by a more-than-estimated 50 basis points to prevent deflation from taking hold in the largest Nordic economy.
The export-led economy, home to Ericsson AB and Electrolux AB, is at risk after growth in the euro region stalled in the second quarter, led by a contraction in Germany in part amid concerns over the effect of Russian sanctions. Sweden sells half its output abroad, of which about 70 percent goes to Europe.
The sub index for orders dropped to 51.8, the lowest since April last year. The index for employment slid to below the 50 level, indicating industry is cutting jobs.