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EUR/NOK currently trades around 10.10, having come down last week from 10.50. Given the current oil price around $70/bbl, analysts at Nordea see room for further downside in EUR/NOK, brief periods where the pair jumps higher cannot be excluded though.

Key quotes

“The key event for NOK last week was the OPEC+ meeting, at which the cartel member decided to keep production broadly unchanged. This was a better-than-expected outcome for oil prices, as it means that global oil inventories can continue to fall, thereby increasing the scope for higher prices both now and down the road. So NOK should continue to gain support from oil prices, both in the short-term and longer out.”

“We do see room for higher USD rates, and that makes us a bit hesitant to become super bullish on NOK in the short-term, as higher rates could have an adverse impact on the stock market and thereby also NOK. Hence, we cannot exclude brief periods where EURNOK jumps higher. A solid resistance level to watch is the 10.50/10.60 area.”