EUR/NOK: Norges Bank rate decision to be largely neutral for the krone – Commerzbank

Norges Bank will announce its rate decision on Thursday. The central bank is set to hold rates at 0.75% and to reiterate that it will hike rates in June. Economists at Commerzbank expect the Norges Bank meeting to have a limited impact on the krone.

Risk aversion is putting downside pressure on NOK

“I assume that Norges Bank will keep everything on hold at tomorrow’s meeting and will signal that the next step will follow in June. This way it is also able to wait and see how things develop.”

“As Norges Bank’s rate hike cycle has already been priced in NOK’s appreciation potential for monetary policy reasons seems to have been exhausted for now.”

“The rate decision is likely to be largely neutral for NOK.” 

“At present risk aversion is the dominating force anyway and is putting downside pressure on NOK just like on SEK.”