FX round-up: Swedish krona, Turkish lira slip as rate-setters turn more dovish

It was a fairly volatile day of trading in foreign exchange markets on Thursday, with big moves in the Swedish krona and Turkish lira after the respective central banks behind them became the latest to sound a dovish note on the outlook.

In Stockholm, rate-setters at the Riksbank pushed back the date of their expected first hike in rates from the back half of 2019 to year-end or the start of 2020, adding that rates would rise more slowly than previously expected thereafter.

That saw the krona drop by 1.06% versus the US dollar to 0.1048.

Meanwhile, in Turkey, the monetary authority erased the reference from its policy statement regarding the possibility of further rate hikes to boost the lira, sending the US dollar up by 1.05% to 5.9352 lira.

There was also a big move in the yen, after the Bank of Japan shifted its so-called forward guidance to predict that its main policy rate would be unchanged "at least through around spring 2020".

Previously, it had promised to keep it at its current low level for an "extended period".

For some analysts that was equivalent to a more 'hawkish' bias, but for others it was the opposite.

Amid all of the above, the US dollar was slightly stronger against the other major currencies, with euro/dollar down by 0.2% to 1.11325 and cable off by 0.07% at 1.28930.