What a strong Swedish krona could mean for foreigners in Sweden

Local Sweden

26-03-2025

The Swedish krona has grown in value in recent months against major currencies like the dollar and the euro, reaching the highest exchange rate against the euro on March 25th since the autumn of 2022. What does this mean for foreigners in Sweden?
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How high is the krona right now?
The Swedish krona is on an upwards curve against both the euro and US dollar, appreciating around 10 öre (0.10 kronor) on March 25th.
At around 1pm on that date, one US dollar cost 10 kronor. In the days just after Christmas in 2023, a dollar cost 9.91 kronor, but before 2022 it was unusual for the dollar to cost more than 10 kronor.
Meanwhile, one euro cost 10.82 kronor on the same date, which is the strongest exchange rate for the krona against the euro since the autumn of 2022.
Why has the krona increased in value?
According to Christina Nyman, chief economist at Handelsbanken, it's "hard to know" exactly what's behind the krona's rise.
"But it might be the fact that the Swedish economy is in a better position than many other countries' economies," she said in a statement earlier in March.
"Sweden has been able to cut the interest rate to what we consider a neutral level, before most other countries, because inflation has dropped."
Another factor which could be playing a role is the fact that Sweden has good public finances, Nyman said. This means for example it will be able to finance future investments in defence through loans, which isn't possible for some countries.
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The bank predicts that the euro will continue to drop in value throughout 2025 – in part due to the fact that Swedish finances are better than state finances in the eurozone.
The European Central Bank is also expected to cut its key interest rate by 0.5 percentage points throughout the year, which could weaken the value of the euro, while Sweden's interest rate is expected to stay at the current level.
Handelsbanken expects to also see the value of the dollar weaken against the krona.
"In the longer term, uncertainty around tariffs and inflation problems [in the US] should drop, while [the American central bank] the Fed will continue slowly to cut interest rates," the bank wrote in a comment to the TT newswire.
"In that case, the krona's value should strengthen further against the dollar."
What could this mean for foreigners in Sweden?
It depends on their individual financial situation, the currency they earn their salary in or hold assets in, and which currency they have the highest outgoings in.
For people who live in Sweden and who are paid in kronor, the past few years have been painful when travelling abroad or sending money back home, as their Swedish money hasn't gone as far as it may have in the past.
The good news is that a stronger krona means that we can expect this situation to change. You'll be able to buy more for your krona when shopping in another currency, whether you're on holiday, sending money to family back home or buying goods from other countries.
On the other hand, if you have savings abroad in dollars or euros, then they are likely to be worth less if you convert them into kronor now than if you'd done so when the krona was weaker.
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What can foreigners living in Sweden do if the strong krona is bad news for them?
Think about the currency you're paid in
It may seem like a good idea to be paid in Swedish krona if the krona is strengthening against the dollar and euro, and that may be the case in the short term, but the best way to protect against currency exchange shocks is to make sure that you're paid in the same currency that you spend in.
This means that if most of your expenses are in dollars, you should try and make sure you're paid in dollars, for example.
If most of your expenses are in Swedish kronor, you should make sure you're paid in Swedish kronor, so your euro or dollar paycheck doesn't suddenly shrink as the value of the krona rises.
Reconsider work abroad
If you've been working as a freelancer abroad or part-time for a foreign company who pays you in dollars or euros, your income may have already started to shrink.
It might be worth trying to find more work in Sweden, increasing your fee for work abroad, or, if you can't get work in Sweden, looking for work in other countries where the exchange rate against the krona is still beneficial for you.
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Time major spending for the best point in the market
If you have savings in dollars or euros and are considering, for instance, buying a holiday house in Sweden, it is probably worth waiting until the dollar or euro has strengthened so you don't end up paying more just because of the exchange rate.
Similarly, if you have savings in kronor and have been planning on buying a property outside of Sweden, now might be a good time to consider doing so.
Get a multiple currency account
It can be helpful to have an account in multiple currencies, such as those provided by banks such as Wise and Revolut. Keeping any cash in a combination of dollars, euros and kronor can reduce your exposure to any single currency.
The advantage for foreigners living in Sweden is that you can set up accounts in multiple currencies, such as US dollars, euros and British pounds, each with their own local bank number, which you can use to receive and make payments domestically in each country.
As the krona strengthens against the euro and the dollar, it may be a good idea to convert some of your kronor to these currencies, so you can get more for your money.