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Pound Sterling to Norwegian Krone Exchange Rate Higher But Forecast Losses Predicted

June 25, 2014 - Written by John Cameron

The Norwegian Krone exchange rate pushed ahead against the Pound Sterling during yesterday’s session as investors moved against the UK tender thanks to distinctly dovish comments from Bank of England Governor Mark Carney.

The Pound Krone exchange rate slipped by just under 0.25% to an intra-day low of 10.3479 during the middle part of the European equities session.

However, the Norwegian unit has endured a torrid June so far, sending the GBP NOK exchange rate from levels just below the psychologically significant 10.0000 threshold as recently as 11th June all the way up to close to 10.5000 during Friday trading.

The Pound to Norwegian Krone exchange rate is trading up +0.44% at 10.42289 GBP/NOK.

The loss of 5% of its relative value by the NOK was driven by a pronounced dip in global appetite for risk following developments in Iraq where ISIS-led rebels have captured several key urbanizations including the nation’s second city of Mosul.

The attendant shift out of risk-laden assets including the Norwegian Krone sent GBP NOK sharply higher. However, the move forward for the pair is by no means guaranteed to persist.

The worrying developments in Iraq have overshadowed an apparent entente cordiale between policymakers in Kiev and Moscow which appears likely to bring an end, (for the time being at least), to the Ukraine crisis.

The NOK received an additional boost at the start of this week’s session when the Iraq crisis propelled the price of a barrel of Brent Crude oil up to close to $116 – well within spitting distance of its highest level since the back end of last Summer.

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This spelled extremely good news for the Norwegian economy, which remains heavily dependent on exports of black gold.

Krone to pound exchange rate forecasted to decline

The Norwegian Krone is likely to have no shortage of supporters in the medium term thanks to Norway’s vast sovereign wealth fund which is currently valued at close to $890bn and is estimated to own a whopping 1.3% of all global equities.

With backing on this scale and with global oil prices likely to continue to ride high, analysts forecast that the Norwegian Krone could be set to stage a concerted comeback against the Pound Sterling any time soon.

Pound Exchange Rates - 25/06/2104



The Pound Sterling to Euro exchange rate is trading down -0.07% at 1.24721 GBP/EUR.
The Pound Sterling to Norwegian Krone exchange rate is trading up +0.44% at 10.42289 GBP/NOK.
The Pound Sterling to New Zealand Dollar exchange rate is trading down -0.39% at 1.95154 GBP/NZD.
The Pound Sterling to US Dollar exchange rate is trading down -0.08% at 1.69676 GBP/USD.
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TAGS: Currency Predictions Norwegian Krone Forecasts Pound Norwe Forecasts

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