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Head of FI Research at Danske Bank Arne Rasmussen believes the case for a stronger NOK remains well and sound.

Key Quotes

“NOK found some support yesterday from Norges Bank (NB) pencilling in a September rate hike. EUR/NOK briefly tested our 3M forecast of 9.40 after the meeting”.

“Today, focus turns to the OPEC meeting and whether the cartel can agree to the production hikes proposed by Saudi Arabia”.

“Scandies compared, it is interesting to note the strong confidence of NB that inflation will pick up as wage growth is picking up, compared with the Riksbank being increasingly nervous that inflation will drop”.

“This dispersion supports our macro cases for higher NOK/SEK and a lower EUR/NOK“.