USD/NOK

Commerzbank’s Antje Praefcke highlights uncertainty over whether Norges Bank will hike in September or wait until December. Inflation remains above target despite a recent downside surprise, while growth is described as close to normal.

Danske Research Team reports that Norwegian core inflation rose to 3.0% year-on-year in August, below Norges Bank’s June projection of 3.3%.

Brown Brothers Harriman's (BBH) Elias Haddad notes Norwegian Krone (NOK) underperformance after Norway’s mixed August Consumer Price Index (CPI) data reduced the perceived likelihood of a near-term Norges Bank hike, with September odds falling from 65% to 38%.

Nomura’s analysts see Norges Bank delivering another rate hike in November as inflation remains sticky, before a 25 bp cut next year and further reductions beyond 2027 towards 3.50%.

BNY’s Geoff Yu notes that stronger Oil prices have improved Norway’s terms of trade, but EUR/NOK gains have pushed up the I-44 import price index.

Rabobank's Senior FX Strategist Jane Foley highlights that the Norwegian Krone (NOK) is the strongest G10 currency across multiple horizons, supported by Oil prices, above-target inflation and a hawkish Norges Bank.