The Swedish and Norwegian crowns could rise as they benefit from capital flows leaving Britain and the euro zone if Britons vote to leave the European Union in a June 23 referendum, Swedish bank Nordea said in a report on Thursday.
In one of the few research notes examining the likely impact on Scandinavian assets from a potential Brexit, the Nordic region's biggest bank by market value said its base case is that Britain will remain in the EU.
If not, "as Brexit is assumed to be negative for Britain as well as the euro area, it should in relative terms be less negative for Sweden," Nordea economist Andreas Wallstrom said.
"A period of high risk aversion where the pound and the euro will be hit and the interest rate differential between euro-area countries will widen could be positive for Swedish government bonds," he added. "The (Swedish) crown should appreciate against the pound and the euro."
If a British "Out" vote turns into a fresh crisis for the euro zone, of which Britain is not a member, it would also lead to a significant strengthening of the Norwegian crown.
Although much less liquid than traditional safe-haven currencies like the yen and Swiss franc, both the Swedish and Norwegian crowns rallied during the Greek debt crisis in 2011 as investors fled the euro zone.
Some investors reckon the Bank of England would have to lower interest rates to mitigate the risks from a possible exit by Britain, probably taking them into negative territory.
With an exit also likely to hurt the euro zone, to which 19 of the 28 EU member countries belong, investors expect the European Central Bank would also take action by loosening policy even further to cushion the economy.
Opinion polls have suggested a neck-and-neck race between those campaigning for Britain to stay within the EU and those who want to leave. Betting markets suggest the country will stay in the bloc it joined in 1973, however, with odds in favour of those who want to stay lengthening in the past few days.
Britain is an important trading partner for both Norway and Sweden. It is Sweden's fourth-largest export market while imports from Britain constitute around 5 percent of total imports. For Norway, too, Britain is a big market, with a 22 percent share of exports.
As such, Nordea expects a prolonged crisis stemming from Brexit to weigh on the outlook for growth in Sweden, Norway Denmark and Finland.