EUR/NOK: Expectations for slightly stronger krone in 2021 – Danske Bank
|Economists at Danske Bank pencil in a modestly stronger Norwegian krone in 2021 and forecast the EUR/NOK pair at 10.20 in 12 months.
Key quotes
“We pencil in a modestly stronger NOK in 2021 on the back of global reflation extending on coronavirus vaccine rollouts, relative growth and rates and seasonal aspects.”
“We underline that given the current levels of the terms of trade, the broad USD and unit labour costs we do not see any valuation arguments for a much stronger NOK.”
“On the back of the recent strong NOK performance, we lower our EUR/NOK profile and now forecast the cross at 10.40 in one month (previously 10.80), 10.30 in three months (10.60), 10.20 in six months (10.50) and 10.20 in 12 motnhs (10.40).”
“The biggest risk to our call is global reflation. If it proves more forceful, we could see EUR/NOK move significantly below 10.00 in the coming years. If, however, the COVID-19 crisis turns into a lengthy economic crisis, EUR/NOK could return to 11.00.”
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.