The Swedish krona (SEK) is considered to be an exotic currency in the Forex market. Sweden is the world’s thirty-second largest economy(CIA.gov).
Trade Surplus or a Trade Deficit
Sweden runs a trade surplus of $21.68 billion, giving the country a ranking of 16 out of the 190 countries tracked by the CIA in The World Factbook(CIA.gov).
What Does Your Economy Export?
Sweden exports machinery, motor vehicles, paper products, pulp and wood, iron, steel products, and chemicals.
According to the World Trade Organization (WTO) (stat.wto.org), Sweden exports $131.2 billion in goods and merchandise compared to only $60.8 billion in commercial services. The WTO breaks down those exports as follows:
Goods and Merchandise
- Agricultural products: 9.2 percent
- Fuels and mining products: 10.3 percent
- Manufactures: 79.5 percent
Commercial Services
- Transportation: 15.8 percent
- Travel: 20.0 percent
- Other commercial services: 64.3 percent
To Whom Does Your Economy Export?
The WTO ranks the following countries as the top destinations for exports from Sweden:
- European Union: 58.2 percent
- Norway: 10.5 percent
- United States: 6.4 percent
- China: 3.1 percent
- Russian Federation: 1.4 percent
What Does Your Economy Import?
Sweden imports machinery, petroleum and petroleum products, chemicals, motor vehicles, iron, steel, foodstuffs, and clothing.
According to the WTO, the country imports $119.8 billion in goods and merchandise compared to only $45.8 billion in commercial services. The WTO breaks down those imports as follows:
Goods and Merchandise
- Agricultural products: 11.7 percent
- Fuels and mining products: 14.7 percent
- Manufactures: 73.3 percent
Commercial Services
- Transportation: 16.0 percent
- Travel: 27.3 percent
- Other commercial services: 56.7 percent
From Whom Does Your Economy Import?
The WTO ranks the following countries as the top sources of imports to Sweden:
- European Union: 69.0 percent
- Norway: 9.0 percent
- China: 3.8 percent
- United States: 3.8 percent
- Russian Federation: 3.4 percent
Do You Have an Attractive Government Debt Market?
Sweden currently has a Moody’s rating of Aaa. It received this latest rating on April 4, 2002. This most recent rating was an upgrade from the Aa1 rating that the country had held previously. This is a positive sign for the country’s government debt market (www.moodys.com).
Do You Have an Attractive Equities Market?
Sweden has an attractive equities market, but it is not very large. It is the twenty-second largest equities market in the world, with a total market value of $432.3 billion (CIA.gov).
Central Bank Mandate
The Sveriges Riksbank is responsible for conducting monetary policy, the objective of which is to maintain a low and stable level of inflation. The bank also has the task of ensuring that payments in the economy can be made safely and efficiently (www.riksbank.com).
The Sveriges Riksbank has foreign currency reserves of $37,918 million and gold deposits of $5,735 million.
Government Intervention in Forex
The Swedish government is not known as an aggressive currency manipulator.
Important Economic Announcements
When you are watching the economic announcements coming out of Sweden, make sure that you keep your eye on the following:
- Interest rates
- Employment
- Inflation
- Gross domestic product (GDP)
- Trade balance
Are You a Safe-Haven Currency?
No, the Swedish krona is not considered to be a safe-haven currency.
How Can I Trade You?
You can trade the Swedish krona using any of the following:
- Spot Forex
- Forex futures
- Exchange-traded funds (ETFs)
- Spot Forex options
- Exchange-traded Forex options
