Stronger Swedish krona - but Equally Expensive Holidays

The krona has strengthened against the euro over the past year. But it does not help Swedes who dream of a cheaper holiday. Purchasing power in Europe is essentially unchanged compared to last summer, says Johan Javeus, chief strategist at SEB.

» Updated: July 31 2024

» Published: June 22 2024

Stronger Swedish krona - but Equally Expensive Holidays
Photo: Henrik Montgomery/TT

The krona has strengthened against the euro over the past year. But it does not help Swedes who dream of a cheaper holiday.

Purchasing power in Europe is essentially unchanged compared to last summer, says Johan Javeus, chief strategist at SEB.

The Swedish krona has successively weakened against the euro since 2013. Last summer, the exchange rate reached a low point and has since recovered, particularly since the beginning of May.

But someone who only looks at the exchange rate risks deceiving themselves.

Compared to a year ago, the krona has strengthened by around three per cent in relation to the euro, but at the same time, prices in most European countries have risen by approximately the same amount, says Johan Javeus.

The two effects together result in almost unchanged purchasing power.

In most countries with the euro, inflation is around three per cent. If you look at Portugal, inflation has been around four per cent. In Italy, it has been one per cent.

But it is difficult to compare countries and plan your holiday based on inflation, emphasizes Johan Javeus.

You're measuring the price of goods in an entire country. Goods that residents buy may not have gone up as much as the goods that tourists normally buy. Generally, Swedes' purchasing power in Europe has not changed.

Those who want to plan their holiday based on purchasing power should instead look east.

In several Asian countries, we have seen currency strengthening. Our currency is strengthening in Indonesia, Thailand, Japan, and Vietnam. In countries like Egypt and Turkey, the krona has also strengthened. But here, inflation is so high that the effects cancel each other out.

Those who want a cheaper holiday can instead review the withdrawal fee at foreign ATMs, currency exchange fees, and other fees that banks charge.

There is no bank card that is best at everything, but if you look at your needs, you can choose the one that suits you best, says Fredrik Nordquist at the Consumers' Bank and Finance Bureau.

Another tip is to check whether it pays to pay with euros or Swedish kronor when making card purchases.

The consumer is faced with a difficult situation. You can either choose a fixed rate in Swedish kronor or a euro rate where you don't know what you'll pay until the day after.

What is best varies, but every time I've checked, it has paid to pay in euros.

Tags

TTT
By TTThis article has been altered and translated by Sweden Herald

More news

Sweden's Industry Agreement Secures 6.4
2 MIN READ

Sweden's Industry Agreement Secures 6.4 Percent Wage Rise Over Two Years

Snus Delivery Strike Averted as
1 MIN READ

Snus Delivery Strike Averted as Union Reaches Agreement

Swedish Manufacturing Growth Continues Despite
1 MIN READ

Swedish Manufacturing Growth Continues Despite Global Challenges

Positive Outlook for Harvest Season
1 MIN READ

Positive Outlook for Harvest Season Despite Challenges Ahead

Sweden's New Industrial Agreement Brings
2 MIN READ

Sweden's New Industrial Agreement Brings Stability in Uncertain Times

Stockholm Stock Exchange Rebounds as
2 MIN READ

Stockholm Stock Exchange Rebounds as Key Stocks Climb

Gold Prices Hit Record High
1 MIN READ

Gold Prices Hit Record High as Tariff Decision Looms

Australian Central Bank Holds Rates
1 MIN READ

Australian Central Bank Holds Rates Steady, Signals Caution on Inflation

Bankruptcies Rise Again with Hotels
1 MIN READ

Bankruptcies Rise Again with Hotels and Restaurants Hit Hardest

Asian Markets Rebound as Investors
1 MIN READ

Asian Markets Rebound as Investors Await Tariff News

Trump's Global Car Tariffs Begin
3 MIN READ

Trump's Global Car Tariffs Begin as Broader Trade Measures Loom

Open AI Secures Record 400
1 MIN READ

Open AI Secures Record 400 Billion Kronor Investment Boost

Swedish Industry Reaches 6.4 Percent
2 MIN READ

Swedish Industry Reaches 6.4 Percent Wage Agreement Over Two Years

Genre image
1 MIN READ

Swedish Industry Sets 6.4 Percent Wage Increase in New Agreement

US Stock Markets Mostly Rise
1 MIN READ

US Stock Markets Mostly Rise Despite Tariff Concerns

EU Stands Firm Against Trump's
2 MIN READ

EU Stands Firm Against Trump's Tariff Threats, Says Swedish Minister

Latvia Secures 2.1 Billion Kronor
1 MIN READ

Latvia Secures 2.1 Billion Kronor Deal with Saab for Air Defense Systems

Renault Acquires Full Ownership of
1 MIN READ

Renault Acquires Full Ownership of Renault Nissan Automotive India

1,700 Jobs Saved as Northvolt
2 MIN READ

1,700 Jobs Saved as Northvolt Navigates Bankruptcy in Sweden

Swedish Pension Saver Loses Appeal
1 MIN READ

Swedish Pension Saver Loses Appeal in Falcon Funds Fraud Case

Huawei Reports First Quarterly Loss
1 MIN READ

Huawei Reports First Quarterly Loss in Years Following Sanctions

France Fines Apple 150 Million
1 MIN READ

France Fines Apple 150 Million Euros for Competition Violations

Maurel & Prom Shares Drop
1 MIN READ

Maurel & Prom Shares Drop 15 Percent After Venezuela License Revoked

Norwegian Oil Fund Invests 1.4
1 MIN READ

Norwegian Oil Fund Invests 1.4 Billion Euro in Offshore Wind Projects

Sweden's Wage Talks Reach Critical
1 MIN READ

Sweden's Wage Talks Reach Critical Stage as Deadline Looms

Sweden Leads Nordic Region in
1 MIN READ

Sweden Leads Nordic Region in Money Laundering, Report Finds

Swiss Varo Energy to Acquire
1 MIN READ

Swiss Varo Energy to Acquire Swedish Fuel Company Preem

German Inflation Drop Signals Potential
2 MIN READ

German Inflation Drop Signals Potential ECB Rate Cut in April

Half of Retrained Workers Shift
1 MIN READ

Half of Retrained Workers Shift to New Industries, CSN Reports

EQT-Backed Omega II Bids 54.9
1 MIN READ

EQT-Backed Omega II Bids 54.9 Billion Kronor for Fortnox

Food Prices Continue to Climb,
3 MIN READ

Food Prices Continue to Climb, but Major Increases May Be Over

Stockholm Stock Exchange Drops as
2 MIN READ

Stockholm Stock Exchange Drops as Trump's Tariff Plans Rattle Markets

Tokyo Stocks Drop Sharply as
1 MIN READ

Tokyo Stocks Drop Sharply as Trump Tariffs Loom

Trump and Starmer Discuss Progress
1 MIN READ

Trump and Starmer Discuss Progress on US-UK Trade Deal

Håkan Samuelsson Returns as Volvo
2 MIN READ

Håkan Samuelsson Returns as Volvo Cars CEO to Drive Electric Future

Security Fund Reports Fewer Layoffs,
2 MIN READ

Security Fund Reports Fewer Layoffs, Sees Hope for Skilled Workers

South Korea, China, Japan Collaborate
1 MIN READ

South Korea, China, Japan Collaborate to Boost Free Trade

Trump's Diversity Order Faces Pushback
1 MIN READ

Trump's Diversity Order Faces Pushback from European Companies

Sweden Seeks to Shield Key
2 MIN READ

Sweden Seeks to Shield Key Goods from EU-US Tariff Clash

Weekend Push for New Industrial
2 MIN READ

Weekend Push for New Industrial Agreement as Deadline Looms