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EUR/NOK seen near 11.00 as Rabobank says NOK outlook holds
Rabobank points to softer Norwegian inflation that has cooled expectations for additional Norges Bank tightening after May’s 25 basis point hike to 4.25%.
Rabobank’s Jane Foley said the Norwegian krone outlook supports a range trading view versus the euro, with expectations for EUR/NOK to hover close to 11.00 over the next one to three months before easing further later.
FXStreet reports Foley tied the shift in rate expectations to softer Norwegian inflation, noting it has tempered expectations for additional Norges Bank tightening even after the central bank raised its policy rate by 25 basis points in May to 4.25%.
FXStreet also highlights that the NOK remains among the strongest G10 currencies this year, with Foley pointing to a roughly 6.85% gain versus the euro since the start of the year, even after some retracement in April.
Looking ahead, FXStreet frames the near term as a trade tied to the evolving path for Norges Bank policy and NOK relative strength, with the focus on the expected move lower on a six month horizon.