NOK vulnerable to profit taking – Danske Bank

Sandeep Kanihama FXStreet Contributor

According to Valtteri Ahti, Chief Strategist at Danske Bank, in terms of the NOK we are facing a thin domestic data calendar in the coming weeks, which alongside technicals, the external environment and the latest Norges Bank re-pricing leaves NOK vulnerable to profit taking, in their view.

Key Quotes

“Our fundamental predisposition remains to re-sell EUR/NOK on rallies. On a separate note, we don’t want to overdo the market impact of the current political uncertainty in Norway. If a vote of confidence results in a change of government to a Labour/Socialist/Centre-government, one should keep in mind that any government will be reluctant to break the fiscal policy rule. Hence, the effect on rates/FX should be negligible. Also, the labour party has a long tradition for fiscal discipline, which should limit further the impact on NOK markets.”

Author

Sandeep Kanihama

FXStreet Contributor

Sandeep Kanihama is an FX Editor and Analyst with FXstreet having principally focus area on Asia and European markets with commodity, currency and equities coverage. He is stationed in the Indian capital city of Delhi.

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