The 25th of February, the exchange rate was 10.64 kronor per dollar, while the euro cost 11.14 kronor. This can be compared to the beginning of February when a dollar cost 11.20 and in January when a euro cost 11.50 kronor. The Swedish krona has thus reached its highest level against the euro in over a year.
However, the strengthened krona has not yet directly benefited household economies, except when it comes to the cost of potential trips abroad.
The initial and short-term effect of the strengthened krona is that we get more currency for our money compared to both the American dollar and the euro, says Shoka Åhrman, savings economist at SPP.
Companies may benefit
In the long run, consumer prices may also be affected. Especially on imported goods such as electronics, clothing, and food.
A long-term strengthening of the krona would clearly benefit companies in the form of lower purchase prices. But if consumers and households are to benefit from this, it also means that companies cannot simply take it in profit margins, says Shoka Åhrman.
A weak Swedish krona has not only been negative for Swedes' personal finances. Those who, like many other households in Sweden, save in index funds that have had large investments in American companies have benefited from the weak krona. The popular "sofa fund" in the pension system has, for example, benefited greatly from the weak krona.
Stick to the course
But there is no reason to review this type of savings even if the krona is now strengthening, thinks Åhrman.
There is definitely a currency effect in different types of savings that we have. But changing one's long-term strategy based on a short-term exchange rate development – in this case, a strengthening of the Swedish krona – one should be very well-informed to do, says she.
It is often the fund manager's role to take into account and balance these aspects.
It is better to stick to one's long-term strategy than to try to time the currency market. Especially in a shift like this, when we are unsure how long it will last, says Shoka Åhrman.
Her advice is not to try to act on every piece of news or change.
It is still easier to control one's expenses and plan one's vacations than to assume that we will have a strengthened krona.
