EUR/NOK: Upside risks in the short term – ING

EUR/NOK has spiked back above 11.50. Economists at ING analyze the pair’s outlook.

The global bond sell-off is negative for NOK

Norges Bank is set to deliver another hike in December. That should be the last one but, if NOK depreciates, NB can easily add more tightening: the domestic economic picture isn’t worrying.

The global bond sell-off is negative for NOK, and while tighter monetary policy helped ease the pain, the recent Oil price correction left the Krone without a floor. 

Also, daily FX sales will remain high into year-end, and NOK downside risks remain tangible before any turn in US data boosts pro-cyclicals.