Krsitoffer Lomholt, Senior Analyst at Danske Bank, gives his views on the Norwegian Krone.
Key Quotes
“We still think the relative growth picture, the positive terms of trade shock (higher oil prices) and a Norges Bank set to initiate a moderate hiking cycle should support a stronger NOK this year. However, in the near term, the NOK faces real headwinds, which limits the short-term potential”.
“In addition, given that markets are already pricing in a September hike with a high probability, which creates an asymmetric balance of risk towards further data disappointments, better-than-expected data will not lead markets to price in more for September at this stage whereas further disappointments would trigger a postponement of the expected first rate hike. In light of the recent data disappointments and headwinds we raise our 6M forecast to 9.30 (9.20 previously) and 12M forecast to 9.20 (9.10), but leave our 1M and 3M forecasts unchanged at 9.60 and 9.40, respectively”.
Share
