EUR/NOK: Trigger for sustainable krone rally not fulfilled yet – Danske Bank

Economists at Danske Bank pencil in a rise in EUR/NOK over the coming one-three months on rising global recession risks but forecast a secular weakening trend amid the outlook for elevated inflation and commodity prices in the years ahead.

NOK forecast lowered but keeping a similar profile

“While we have embedded a NOK rebound into our forecast for some time we are not convinced that the latest NOK strengthening marks a sustainable turning point. As a trigger, we look for central banks globally to pivot into a more dovish stance and we are not yet convinced we are at this stage yet.” 

“We forecast EUR/NOK at 10.00 in 1M (from 10.50), 10.40 in 3M (from 10.60), 10.20 in 6M (from 10.40) and 9.80 in 12M (from 10.00).”