Nordea strategists see the Norwegian Krone (NOK) broadly stable over the next six months after July’s EUR/NOK decline, driven by higher Oil prices and Norges Bank’s increased NOK purchases. They stress two-sided risks tied to Middle East developments and Oil, but expect a somewhat stronger NOK in 2027 as a weaker US Dollar (USD) and supportive global risk sentiment gradually push EUR/NOK lower.
Oil risks and dollar backdrop
"Following the appreciation in July, we expect the NOK to remain more or less unchanged over the next six months."
"In fact, we continue to see considerable risks in both directions."
"Looking further ahead, we continue to see scope for a somewhat stronger NOK in 2027."
"If our expectation of a weaker dollar next year materialises, this should therefore provide support for the NOK."
"Overall, our base case is for a more or less unchanged NOK over the next six months, followed by some appreciation during 2027."
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