FXStreet (Edinburgh) – In opinion of Jane Foley, Senior FX Strategist at Rabobank, the Norwegian krone is expected to remain under pressure in light of oil weakness and a potential rate cut by the Norges Bank.
Key Quotes
“There is no denying the heavy drag on the value of the NOK since the end of 2014 from the plunge in oil prices”.
“The stress on Norway’s energy sector was reflected last year in slashed investment budgets and by an upward trend in unemployment. It has not all been bad news, however”.
“The sharp drop in the value of the NOK has been a boon to Norway’s non-energy sector which makes up around 50% of exports. The Norwegian Seafood Council has reported an 8% y/y increase in seafood exports in 2015”.
“Norges Bank Governor Olsen has predicted that the Norwegian recovery would start in 2017, aided by the weaker value of the NOK. In the coming months there is risk that interest rates will be cut again. This should ensure the NOK remains vulnerable”.
(Market News Provided by FXstreet)