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8 Sep 2015
EUR/NOK: still room for further upside – Danske Bank
FXStreet (Edinburgh) - Analyst Kristoffer Lomholt at Danske bank sees the possibility that the cross could still squeeze higher in the next weeks.
Key Quotes
“At the end of last week a dovish ECB, improved risk sentiment and a higher oil price weighed on EUR/NOK sending the cross towards 9.20”.
“The beginning of this week has, however, seen the cross rebound to the 9.30-level amid a lower oil price and disappointing NOK manufacturing figures for July”.
“Although our short-term models suggest that the spike is marginally overdone, we still see risks for the cross skewed to the upside going into the Norges Bank meeting on 24 September”.
“Currently markets have yet to fully price a 25bp cut (c.18bp priced) and in addition, it remains our view that global growth concerns are unlikely to fade near term, which naturally caps the short-term upside potential in the oil price”.
Key Quotes
“At the end of last week a dovish ECB, improved risk sentiment and a higher oil price weighed on EUR/NOK sending the cross towards 9.20”.
“The beginning of this week has, however, seen the cross rebound to the 9.30-level amid a lower oil price and disappointing NOK manufacturing figures for July”.
“Although our short-term models suggest that the spike is marginally overdone, we still see risks for the cross skewed to the upside going into the Norges Bank meeting on 24 September”.
“Currently markets have yet to fully price a 25bp cut (c.18bp priced) and in addition, it remains our view that global growth concerns are unlikely to fade near term, which naturally caps the short-term upside potential in the oil price”.