EUR/NOK: Krone may weaken after Norges Bank's first rate hike – Nordea
|The Norwegian krone has gained against both the euro and the US dollar lately. As economists at Nordea note, history shows that the NOK usually strengthens on average going into Norges Bank’s first rate hike and thereafter moves fairly sideways.
See: EUR/NOK to dip below 10.20 as Norges Bank to go ahead with tightening plans – ING
Mini NOK rally before Norges Bank’s rate hike
“Looking at past experiences when Norges Bank has started a hiking cycle, the NOK on average usually strengthens going into the first rate hike and then move fairly sideways after the hike.”
“The more NOK strengthens ahead of next week’s Norges Bank meeting the higher the probability of a ‘buy the rumour, sell the fact’ development whereby the NOK could temporarily become weaker after next week’s rate meeting.”
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