NOK expected to appreciate further – Danske Bank

Kristoffer Lomholt, Senior Analyst at Danske Bank, assessed the positive outlook for the Norwegian Krone in the next months.
Key Quotes
“Fundamentally, we still see an appealing case for why the NOK should strengthen over the coming year on not least broader based Norwegian growth, valuation and relative rates stemming from Norges Bank initiating a moderate hiking cycle”.
“Meanwhile, the fundamental case has been weakened slightly over the last month by global growth levelling off and domestic data disappointing slightly. Also tactically, positioning is becoming a headwind as investors have bought heavily into the case of a stabilising housing market and forthcoming rate hikes. This leaves the NOK vulnerable to profit taking and we therefore expect EUR/NOK to be range-trading near term”.
“In light of this we raise our 1M forecast to 9.60 (from 9.50) but leave the rest of the profile unchanged at 9.40 in 3M, 9.20 in 6M and 9.10 in 12M”.
Author

Pablo Piovano
FXStreet
Born and bred in Argentina, Pablo has been carrying on with his passion for FX markets and trading since his first college years.

















