June 20 (Bloomberg) -- Morgan Stanley foreign-exchange strategists advised selling Sweden’s krona versus the Norwegian krone, saying slower global growth may weaken demand for Swedish assets while higher oil prices boost Norway’s currency.
“In the current environment we warn that the krona is vulnerable given Sweden’s exposure to the global manufacturing cycle,” strategists led by Hans Redeker in London wrote in a research report today. “We expect the krone to outperform on a relative basis, given that our commodities team still expects oil prices to rise further this year, on the back of both strong demand and tight supply.”
Investors should bet the krone will strengthen to 1.20 against the krona and end the trade if it falls to 1.151, the strategists wrote.
The krone weakened 0.2 percent to 1.1583 against the krona as of 11:06 a.m. in London.
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