Our model estimate based on Oil prices and petroleum revenue forecasts suggests purchases should be kept at 1,400mn for December. However, it’s worth highlighting that Norges Bank scaled back FX operations quite substantially in December (compared to the previous month) over the past three years, more than what our model would have suggested. 

We are bullish on NOK in the medium term, but we suspect the rally has started too early. That is, however, only due to external factors, as markets have priced out the chance of a Norges Bank hike in December (20% priced in now) and a potential reduction in FX purchases in December is positive for the Krone.