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Explained: What does the stronger Swedish krona mean for you?

The Swedish krona has been getting stronger recently. As an international resident, you may be wondering what that means for your saving, investment and spending decisions.

Explained: What does the stronger Swedish krona mean for you?
Any change in currency means there are winners and losers. Photo: Sofia Sabel/imagebank.sweden.se

In March and April, the krona was in decline, and that followed extreme lows in 2019 when it reached its lowest price against the dollar in 17 years and against the euro in a decade.

But over summer 2020 the Swedish currency has staged a recovery. According to the Central Bank's KIX index, which compares the krona to a range of other major currencies, the krona has risen by almost 9 percent since mid-March.

In March, a US dollar was equivalent to 10.5 kronor, a figure now down to around 8.7 kronor. And a euro is now equivalent to 10.3 kronor, compared to a low point of 11.2 kronor earlier this year.

The positive trend holds up against most of the world's major currencies, and according to forecasts by bank SEB, it isn't slowing down yet. The bank forecasts a further rise of between five and 10 percent against the dollar and euro, predicting that the euro will fall to around 10 kronor by the end of the year, and the dollar to around 8.35.

Lower interest rates in many countries outside Sweden, and the dollar's downward trend, are two of the factors behind this.

Any change in the currency means there are winners and losers when it comes to businesses and private individuals. It's generally good news for companies which rely on imports, since they can buy more from abroad for less, while exports may suffer. 

Your money in Sweden:

Many savers in Sweden put their money into international funds and shares, which means returns are smaller when the krona is comparatively weak. It's not the best time to be making transfers from dollars, euros or pounds into kronor. 

But that only applies if you're converting your funds or shares into kronor. If you're saving for the mid- or long-term and don't need to withdraw them yet, there's usually not much point worrying too much about fluctuations either in the stock market or in exchange rates. The important thing is to have diversified your savings so that you've spread the risk.

Those who receive a salary or pension paid in euros or another comparatively weak currency will get less for your money when spending in Sweden. Anyone planning a move or an investment in Sweden, such as buying a house, using savings from outside Sweden is therefore in a weaker position right now than earlier in the year.

And it also means trips to Sweden from overseas are more expensive than usual – although the impact of global travel restrictions, limited flights, and other consequences of the pandemic will be more important. It's fairly unlikely that the currency exchanges will be many people's top priority when deciding whether or where to travel in the near future.

For those who are paid in kronor and will travel overseas, or send money overseas (for example, to family members in their home country), the reverse is true – you're currently in a much stronger position than this spring or one year ago.

The global economic situation is currently hard to predict given the unprecedented nature of the coronavirus crisis.

 

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How to avoid falling victim to tax scams in Sweden

Sweden's tax agency, Skatteverket, warns of an increase in scams when it's time for Swedish tax-payers to declare their taxes.

How to avoid falling victim to tax scams in Sweden

Anyone who earned more than 22,208 kronor last year received their tax returns digitally last week, marking the start of tax season.

That also means an expected peak in tax-related scams, Skatteverket warns.

Most of the scams are so-called phishing scams, meaning attempts to steal the victims’ personal information. Fraudsters may for example email a person, pretending to represent Skatteverket, and ask them for, among other things, their banking details.

“We’re seeing these in all channels. They use fake emails, SMS, letters and in some cases even phone calls. It is particularly common in tax declaration times – just when we’re about to send out the tax returns, the e-service opens and it’s possible to declare – but above all when it’s time for tax rebates,” Jan Janowski, a Skatteverket expert, told Swedish news agency TT.

A scam email might for example state that you’re entitled to a tax rebate and that you should click a link to receive it. Don’t click any links, open any attachments or reply to the message. Skatteverket advises that you immediately delete the email or text message.

Another common scam is that you receive a text message claiming to be from Skatteverket, telling you that you owe them money and you need to log in to calculate the amount. The website you’re urged to log in via does not belong to Skatteverket. Don’t click the link.

The agency stresses that it never asks people for their banking details. The exception is that you may be asked for your bank account information if you log into Skatteverket’s website to declare your taxes, but that always first requires you to log into the site.

To receive your tax rebate, you need to inform Skatteverket of your bank account number. You do this not by clicking a link in an email or SMS, but by logging into their website using a digital ID, for example BankID, and submitting your details. Only do this on your own initiative. If someone calls you and asks you to log in with your BankID during the phone call, don’t do it. That’s another common scam.

Skatteverket will also never call you to ask for your bank account or credit card number.

It will be possible to declare your taxes from March 19th. You’ll receive any tax rebate you’re owed by mid-April or early June, depending on when you submit your tax return. These are the dates when fraudsters are likely to attempt the most scams.

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