NOK should appreciate moderately against the Euro in the course of the year – Commerzbank

Economists at Commerzbank are comfortable with their forecast of a moderate appreciation of the Krone during the rest of 2023 and next year.

Norges Bank's hawkish stance is no longer lagging behind the ECB's

Increased risk aversion in the market is weighing on the NOK, but rising Oil prices are supporting it. In this respect, the current geopolitical situation is relatively neutral for the Krone, but it is likely to trade volatile in the short term.

Norges Bank does not see first interest rate cuts until the end of 2024. At the same time, from a market's perspective, the ECB will no longer act decisively enough against stubbornly high inflation next year with a view to the peripheral countries, so that a risk premium on the Euro is justified. This suggests that the NOK will continue to appreciate against the EUR in 2024.

Source: Commerzbank Research