Trend Movements in the Swedish Krona Exchange Rate against the Euro – An Explanatory Framework

This Economic Brief analyses long-term movements in the nominal exchange rate of the Swedish krona to the euro. It develops a quantitative analytical framework, anchored in purchasing power parity theory, that tracks trend changes relatively well.

Highlights

• It is a tribute to [Gustav] Cassel that more than a hundred years after his pioneering contributions that already leaned heavily on the experience of the Swedish krona, purchasing power parity theory can still help understand movements in that currency.
• Differences in broad monetary and financial conditions between Sweden and the euro area may account for a trend weakening of the Swedish krona relative to the euro.
• Broad trends in the nominal exchange rate of the Swedish krona against the euro can be understood. 

Information and identifiers

Economic Brief 90. May 2026. Brussels. PDF. 18pp. Tab. Graph. Bibliogr. Free.

KC-01-26-026-EN-N (online)
ISBN 978-92-68-36426-0 (online)  
ISSN 2443-8030  (online)
doi:10.2765/5981105 (online) 

JEL classification: C3, E31, E4, F31, F37.

Disclaimer

European Economy Economic Briefs are written by the staff of the European Commission’s Directorate-General for Economic and Financial Affairs to inform discussion on economic policy and to stimulate debate. The views expressed in this document are solely those of the author(s) and do not necessarily represent the official views of the European Commission.