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What does the ‘exceptionally weak’ Swedish krona mean for you?

Ignoring a few months in the financial crisis, the Swedish krona is now weaker than it's been in a century. What does that mean for internationals planning to moving here, or those who already have?

What does the 'exceptionally weak' Swedish krona mean for you?
The weak krona means executives coming from Europe and the US will be able to buy a more expensive house. Photo: Hasse Holmberg/TT
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The krona dropped still lower last week after Sweden's central bank signalled that with inflation still stubbornly under target there was now no chance of an end to negative interest rates this summer. You now need 10.6 kronor to buy a euro, up from 8.2 back in 2012. 
 
“It's quite clear that the krona is exceptionally weak,” Andreas Wallström, Chief Analyst at Nordea Markets, tells The Local. “Apart from the financial crisis, you have to go back 100 years to find it weaker…although of course the euro didn't exist back then, so it's sort of a synthetic euro.”
 
He doesn't expect change any time soon. 
 
“There's currently nothing really pointing to a strengthening of the krona. If you look at growth relative to the eurozone, we are really in for a slowdown now, whereas growth in Europe is quite strong.” 
Richard Falkenhäll, Senior FX Strategist at SEB, agrees:  “We have probably, along with Switzerland, the lowest short-term interest rates in the world right now, at -0.5, and that's despite several years of very strong growth.”
 
“That's a very negative thing for the Swedish krona, so I think we have to get used to a weaker Stocky [krona] at least this year and probably into next year.”  
 
If you're a tourist, of course, this is wonderful news: a pint of beer that would have cost you a jaw-dropping nine euros five years back now costs under seven.  
 
But if you're an international who's come to Sweden to work, or is planning to, it's rather less appealing. 
 
“You should make sure that you don't get paid in Swedish krona,” Wallström says, slightly tongue-in-cheek. 
 
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Jamie Hart, Managing Director at the recruitment firm Michael Page in Stockholm, says the low exchange rate is less of a problem for a foreigner negotiating their salary ahead of a move to Sweden, as their pay will normally be set by the real cost of living. 
 
“It will just cost the companies more to match up to the euro equivalent,” he says. “Generally speaking if you're recruiting people, the exchange rate is not what you base pay on, it's based on the cost of living.” 
 
People moving to Sweden may also find buying a house is a less daunting prospect that it was. 
 
“As the housing market in Sweden has lost about 10 percent in the last year, at least in Bromma where I work, you are getting a double effect,” says Pär Gunnarsson, who works for Swedish estate agents Fastighetsbyrån. 
 
And while he hasn't noticed an increase in the number of foreign buyers, he suspects those that come are able to spend more. 
 
“When you buy a house in Stockholm or Sweden, it's basically because you're moving here, and you buy the house you can afford. I don't think we have more foreign buyers in Stockholm, but maybe they can buy a more expensive house.” 
 
The exchange rate is more of an issue for workers who negotiated a pay deal back in 2012, when the krona was much higher.
 
If you negotiated an annual salary of 800,000 kronor back then, you've now taken a pretty substantial €21,000 cut in your annual euro earnings. 
 
“For an expat today having an income in krona, you probably just have to get used to earning less,” Falkenhäll says. “It's the same for us Swedes. It's starting to get quite expensive to travel abroad.” 
 
But Wallström believes it's not all bad news, as the low exchange rate combined with strong global demand is leading to boom times for Swedish exporters. 
 
“Swedish exporters are enjoying happy days and there is a  labour shortage in many sectors, so the demand for foreigners is likely to increase,” he says. 
 
Those already working in export-driven industries are in a powerful position to negotiate a pay increase, while those applying for jobs can probably afford to be quite demanding when it comes to salary. 
 
“There's a big demand for international skillsets particularly in the technology field, digital and engineering,” Hart says. “There's a big demand for people who want to move.” 
 
For many of people he recruits from the UK and Europe, salary is not the only reason to move to Sweden anyway. 
 
“There's upside in terms of quality of life, the length of your commute, the number of hours you work,” he says. “There's still positives about working in Sweden.” 
 
Still want to move to Sweden? Looking for a new job? Find your dream English-language role on The Local Jobs.
 

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TRANSPORT

How to save money at Sweden’s airports

Sweden is not a cheap country by any means, and the extra charges at airports can make travelling feel even more costly. Luckily, there are ways to make trips to Swedish airports more affordable.

How to save money at Sweden's airports

Sweden has become increasingly expensive over the past few years, in line with the cost of living crisis, inflation and rising food prices affecting much of Europe.

These significant price increases make the high costs at Swedish airports even more noticeable, leaving many travellers, already burdened by inflation, feeling the pinch.

Luckily, there are ways to make your stay at Swedish airports more affordable.

Bring your own food – or buy it before getting to the airport

When travelling through a Swedish airport, according to the official information on the Sweden’s Transport Agency’s website, you are allowed to bring solid food through security and onto the plane.

However, if the food is considered a liquid, restrictions will apply. Liquids include foods such as jellies, creams, drinks, soups, and dishes with both solid and liquid components (like meat and potatoes with sauce or pickled cucumbers). This rule applies even if the food is frozen.

Use this information to prepare your own meals (sandwiches are a good option for longer flights, while snacks may do the trick for shorter ones) or buy food before you get to the airport.

Both will lead to saving a lot of money compared to airport food prices.

Cutting (transport) costs on your way to the airport

Sweden’s major airports have express services that make getting there quick and efficient, but these can be a tad expensive.

Fortunately, there are cheaper alternatives.

For example, in Stockholm, you can take the non-express commuter train instead of the Arlanda Express or combine a train plus bus option.

Both options cost less, though they do take longer (the express train trip lasts around 20 minutes, while the cheaper alternatives will take around 40 minutes).

For a detailed guide to your transport options if you want to skip the Arlanda Express (or if it isn’t running), check out The Local’s guide on the topic here.

Do your research before getting there

All of Sweden’s busiest airports are operated by the state-owned company Swedavia, which makes it easier to check out your dining options in advance.

Knowing where to find the cheaper and more expensive eateries can help you plan better.

You can find an overview of available restaurant, bar, and cafe options on a per airport and per terminal basis, as well as their opening hours, on the company’s website.

For Arlanda Airport, check here. For Landvetter, here.

Keep in mind that the most affordable options might be before security.

Are lounges worth it?

While suggesting you spend money on a lounge might seem counterintuitive, it can sometimes be a cost-effective option. You’ll just need to do some simple maths to determine whether it’s worth it.

A meal and a drink at a Swedish airport could easily cost a few hundred kronor.

Lounges, which typically include buffet food and drink options, might offer better value for money, if you’re planning to buy food in a restaurant at the airport rather than bringing your own with you. They also often have shower facilities, office spaces including printers, and children’s areas, which may make the cost worth it depending on your journey and whether you’re travelling with family or not.

For the SAS international lounge at Arlanda, the cost is usually around 350 kronor when purchased in advance online and slightly higher if bought at the lounge reception on the day of your visit​.

Note that if you are a frequent flyer or have certain credit cards, you might have access to lounges for free or at a discounted rate, using points to pay for some or all of the fee.

Don’t buy the first thing that seems cheap at the airport – a better deal might be waiting outside

Many items found in airport stores and duty-free shops are available outside the airport, and often at better prices.

While duty-free items are tax-free, you might still find better deals by shopping around elsewhere (in fact, this is often the case for both food and drinks).

Resist the temptation to buy stuff that seems cheap at the airport unless you’re absolutely sure you’re getting a fair price. You can always do a quick Google search before you buy to see if you can get it cheaper somewhere else.

You will likely save more by purchasing it outside the airport.

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