Economists at Danske Bank acknowledge that the near-term prospects for NOK look more challenging than previously penciled in and lift the short-end of their forecast profile, but keep the downward trajectory.

Lifting profile but maintaining a downward trajectory

“We acknowledge that the near-term prospects for NOK look more challenging than previously pencilled in. In case systemic risk fears spread further NOK still looks vulnerable. However, in the situation that systemic risk fears subside the NOK rebound could also face headwinds down the road as this would opens the door for markets pricing back in central bank rate hikes. For this reason, we lift the short-end of our forecast profile.”

“We still firmly believe in a more bullish secular positive case building for the NOK years on commodities incl. energy constituting an outperforming equity sector.”

“Forecast: 11.30 (1M), 11.20 (3M), 10.80 (6M), 10.60 (12M).”