The British Pound to Norwegian Krone exchange rate continued to trend near its best weekly levels on Thursday as low demand for oil made it difficult for the Krone to capitalise on a weakened Pound.
Demand for Sterling slipped on Thursday afternoon after it was confirmed that Bank of England (BoE) hawk Kristin Forbes would be leaving the Monetary Policy Committee (MPC) in June. This held the Pound back from its best levels.
[Previously updated 08/07/2017]
GBP NOK Advance Seen as Commons Gears Up for Another Article 50 Bill Vote
The Pound has risen by around 0.2% against the Norwegian Krone today, although recent UK news has put investors on edge rather than causing an overflow of optimism.
The latest Brexit development has seen a number of proposed Article 50 bill amendments get blocked. This comes at a time when the idea of leaving the EU outright without securing a trade deal has been mused, something to put serious concern into the minds of investors.
The House of Commons is due to hold another round of amendment proposals today, but the greater focus will be on a later vote that could well shatter the GBP NOK exchange rate.
Forecast Approval during Bill’s Third Reading could Soften GBP NOK Exchange Rate and Trigger GBP Crash
The next Article 50-linked news is due tonight, when MPs in the House of Commons vote again on the bill as part of its third reading. This is broadly expected to result in a ‘yes’ vote, which will move the bill another step closer to passing though both Houses.
Looking further ahead, the Pound may be able to rise against the Krone on Friday morning when the UK manufacturing and industrial production stats are released.
At the time of writing, a rise was expected on the year for both fields in December, although a monthly slowdown was also forecast.
NOK Slumps after Brent Crude Costs Drop Off
The Krone’s latest dip against the Pound has come after detrimental domestic and commodity-based news; in the former case, production figures have proven highly disappointing for NOK investors.
On the month and the year in December, industrial production has fallen into negative ranges, while annual manufacturing production during the same month has remained negative with a shift from -4.2% to -2%.
Elsewhere, Brent crude costs have continued their slide since early February, falling from around $56.75 per barrel to $54.77.
Future NOK Demand Tied to Brent Prices, GDP Figures
The remainder of the current week will bring a number of major Norwegian economic announcements, continuing with Thursday morning’s GDP growth rate figures for Q4. On the quarter, a major improvement from -0.5% to 0.7% is forecast.
Further ahead on Friday, core inflation is forecast to rise on the month and the year in January, while the more mixed base figures have a monthly rise and annual slowdown predicted.
Aside from these forecast releases, the Krone could also be shifted against the Pound by any significant fluctuations in the price of Brent crude oil.