The Swedish krona (SEK) is the official currency of Sweden. It is issued by the Riksbank, the central bank of Sweden. The krona was introduced in 1873, replacing the Swedish riksdaler. It has been a key part of Sweden’s economy and monetary policy for over 140 years.

Overview of the Swedish Krona

The krona is divided into 100 öre. However, öre coins are no longer in circulation. The smallest denomination currently circulating is the 1 krona coin.

Some key facts about the SEK:

  • ISO 4217 currency code: SEK
  • Central bank: Sveriges Riksbank
  • Inflation rate (2022): 9.3%
  • Interest rate (2022): 0.75%
  • Coins: 1kr, 5kr, 10kr, 20kr
  • Banknotes: 20kr, 50kr, 100kr, 200kr, 500kr, 1000kr

The krona was pegged to gold until 1914. Since then, it has switched between fixed and floating exchange rate regimes. Currently, the krona operates under a free-floating exchange rate.

The krona is a very popular global reserve currency due to Sweden’s political stability, low inflation rates, and positive trade balance. However, the Riksbank intervenes occasionally to curb currency appreciation or depreciation.

History of the Swedish Krona

The krona has origins dating back to the 17th century. In 1668, Stockholms Banco issued the first banknotes denominated in Swedish daler and riksdaler. As the Bank of Sweden gained influence in the late 19th century, it issued an exclusive right to print banknotes in Swedish currency.

The krona was introduced in 1873 after Sweden decided to go on the gold standard. The new currency replaced the riksdaler at a rate of 1 krona = 1⁄2 riksdaler. This peg to gold ensured stability and made the krona an attractive global currency.

In 1914, the krona left the gold standard along with many other currencies. It briefly returned to the gold standard between 1916-1931 but was again taken off to deal with the challenges from World War I and the Great Depression.

In 1931, Sweden left the gold standard permanently. This allowed the country to have a more independent monetary policy focused on domestic pricing and employment stability.

The Bretton Woods system fixed the krona’s exchange rate to the US dollar in 1944, which gave Sweden’s currency stability after World War II. This was abandoned in 1971 along with the Bretton Woods system, allowing the krona to float freely.

In the late 20th and 21st century, the krona has fluctuated based on factors like monetary policy, inflation, political uncertainty, and economic growth. The financial crisis of 2008 led to sharp depreciation of the Swedish krona.

Overall, the Riksbank has maintained prudent fiscal and monetary policies to ensure the krona remains stable despite shifting exchange rate regimes over the decades.

Coins and Banknotes

Swedish krona banknotes and coins have evolved significantly in terms of production, design, and security features.


  • 1 krona: First minted 1989; copper-plated steel
  • 5 kronor: Introduced 1873; copper-nickel alloy
  • 10 kronor: Introduced 1991; copper-nickel alloy
  • 20 kronor: Introduced 1873; bronze alloy


  • 20 kronor: Introduced 1976; Measure 125x66mm
  • 50 kronor: Introduced 1986; Measure 134x70mm
  • 100 kronor: Introduced 1991; Measure 140x76mm
  • 200 kronor Introduced 1997; Measure 147x82mm
  • 500 kronor: Introduced 1989; Measure 156x82mm
  • 1000 kronor: Introduced 1995; Measure 164x82mm

Modern Swedish banknotes have security features such as holograms, watermarks, embedded security threads, microtext, and raised ink. The notes depict important Swedish cultural icons, monarchs, and historical artifacts.

Coins feature the effigy of King Carl XVI Gustaf on one side and unique designs like plants, animals, or landmarks on the other.

Swedish Economy and Monetary Policy

As a developed mixed economy, Sweden’s economic growth and stability are closely tied to the state and effectiveness of its monetary policy.

Key Facts

  • GDP: $564.7 billion (USD)
  • Per capita GDP: $53,899 (USD)
  • Main industries: services, manufacturing, mining
  • Major trading partners: Norway, Germany, Denmark

Monetary Policy

Swedish monetary policy is focused on price stability through inflation targeting. The Riksbank aims to maintain an inflation rate around 2%.

Key policy tools include:

  • Repo rate: Benchmark interest rate to signal monetary stance
  • Asset purchases: Buying securities to increase money supply
  • Reserve requirements: Mandatory reserves banks hold at Riksbank
  • Exchange rate management: Interventions to curb currency fluctuations

The Riksbank enjoys a high degree of central bank independence which allows it to carry out long-term policy strategies without political pressures. This has contributed to keeping Swedish inflation low compared to other developed economies.

Prudent economic management and robust financial regulations have allowed Sweden to thrive despite global volatility and crises. The krona serves as an anchor of stability for the economy.

Exchange Rates and Forex Trading

The Swedish krona is actively traded on the foreign exchange market due to Sweden’s strong fundamentals and global connections. Here is an overview of SEK exchange rates and forex trading.

Current Exchange Rates

Here are current exchange rates for 1 Swedish krona (August 2022):

  • USD: 0.091
  • EUR: 0.089
  • GBP: 0.076
  • JPY: 13.286
  • AUD: 0.133

Drivers of Exchange Rate Movements

Factors that influence SEK exchange rates include:

  • Relative inflation: Krona rises if Swedish inflation lower than trading partners
  • Interest rates: Higher rates lead to currency appreciation
  • Trade flows: Surpluses increase krona value, deficits decrease it
  • Risk sentiment: Safe haven demand during crises causes krona to rise
  • Riksbank policy: Interventions impact currency pricing

Trading the Krona

The krona is considered a “major” in forex markets, with tight spreads and high liquidity. Key points for traders:

  • Floating exchange rate provides opportunities
  • Riksbank policy causes volatility at times
  • Stability makes carry trades popular using the krona
  • Strong technical analysis patterns form on SEK pairs
  • Correlates strongly with other safe haven currencies

The krona offers unique opportunities for forex traders who understand Sweden’s economic drivers and the Riksbank’s policy goals.

Use of the Krona Internationally

Beyond everyday use in Sweden’s domestic economy, the Swedish krona has some key roles globally:

Reserve Currency

The krona comprises around 2% of global foreign exchange reserves. Holding SEK reserves provides stability and diversification for central banks. Factors driving reserve demand include:

  • High liquidity and convertibility
  • Stable value due to strong Swedish fundamentals
  • “Safe haven” qualities during financial crises

Invoicing Currency

Some Swedish exports are priced in krona rather than euros or dollars. This reduces exchange rate risk for Swedish firms in international trade. Industries like machinery, vehicles, paper, and electronics use SEK pricing.


Sweden has a vibrant tourism industry focused on nature, culture, and design. Visitors need to obtain krona for expenses. SEK is readily exchanged at airports, banks, forex bureaus, and ATMs across Sweden.

Threats and Issues Facing the Krona

While the krona remains strong, there are some threats on the horizon that could undermine it:

Declining Cash Usage

Sweden is rapidly transitioning to a cashless society. This reduces demand for physical krona and could fragment the monetary system. The Riksbank is considering a digital krona to modernize circulation.

Low Inflation

Inflation has lingered below the 2% target since 2014. This limits the Riksbank’s monetary policy options. Unconventional policies like negative rates have complicated impacts. Normalizing policy could spark currency fluctuations.

Household Debt Levels

Swedish household debt is very high relative to disposable income. This is due to large mortgages amid a housing boom. While banks remain well-capitalized, private debt poses financial stability risks.

Demographic Headwinds

An aging population limits growth and puts pressure on public finances. Immigration is needed to counter slowing population growth. Integrating migrants poses economic and social challenges.

Overall, Sweden’s strong economic fundamentals should keep the krona stable. But risks like high household debt and sluggish demographics require prudent oversight of the currency and financial system.


For over 140 years, the Swedish krona has served as a pillar of the country’s economy and facilitated international trade. Sweden’s reputation for stability, transparency, and prudent financial governance has kept its currency strong through changes in the global monetary order.

Looking ahead, the krona faces some risks like high household debt and technological changes. However, the Riksbank stands ready to defend the currency’s value and credibility with necessary interventions and policies. For now, the Swedish krona remains a symbol of economic prosperity for Sweden and a trusted reserve asset worldwide.