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15 Apr 2015
EUR/NOK seen at 8.15 in 12-month view – Danske Bank
FXStreet (Edinburgh) - According to analysts at Danske Bank, EUR/NOK could grind lower to the 8.15 area in a 12-month horizon.
Key Quotes
“According to our short-term financial models the latest move lower in EUR/NOK has been driven by the long end of rates and the oil price recovering after the Iranian nuclear negotiations driven dip around Easter”.
“Importantly, however, our models suggest that the move lower has been excessive given current fundamentals”.
“In addition, as we regard the oil price risk to be skewed to the downside in the coming month we think EUR/NOK will edge slightly higher in the short term”.
“In the medium term we – contrary to market pricing - still expect Norges Bank to cut rates only once (namely in June by 25bp) and hence a repricing of Norges Bank should together with a general oil price recovery and ECB QE drag the cross lower towards our 12M forecast of 8.15”.
Key Quotes
“According to our short-term financial models the latest move lower in EUR/NOK has been driven by the long end of rates and the oil price recovering after the Iranian nuclear negotiations driven dip around Easter”.
“Importantly, however, our models suggest that the move lower has been excessive given current fundamentals”.
“In addition, as we regard the oil price risk to be skewed to the downside in the coming month we think EUR/NOK will edge slightly higher in the short term”.
“In the medium term we – contrary to market pricing - still expect Norges Bank to cut rates only once (namely in June by 25bp) and hence a repricing of Norges Bank should together with a general oil price recovery and ECB QE drag the cross lower towards our 12M forecast of 8.15”.