FX.co ★ Sweden discusses euro adoption

Currently, Sweden's monetary authorities are considering adopting the euro. Economists are weighing the pros and cons of this move and whether it makes sense to continue using the Swedish krona. Notably, Sweden began contemplating this after the krona faced an unprecedented slump in 2022. According to Bloomberg, only the Liberal Party in the parliament supports the switch to the euro. Advocates push for this change, especially as Sweden has moved away from its previous reluctance to join NATO. Now, the country seems open to applying for membership in the military alliance. Economists believe that the krona's decline was driven by the country's longstanding dovish monetary policy stance. However, they also highlight potential risks to the Swedish economy from adopting the euro. Notably, Lars Calmfors, a Swedish economist, said that he was frequently asked to assess the feasibility of such a transition, emphasizing its challenges. Today, 20 out of the 27 EU countries use the euro. In the early 2000s, a referendum in Sweden resulted in the country rejecting the EU currency. According to a survey by the Swedish publication Dagens Industri, 6 out of 10 top national company leaders support the transition to the single currency and are willing to back the government's initiative.