17 Jun 2015
Norges Bank expected to cut rates by 25 bp – Danske Bank
FXStreet (Edinburgh) - The Nordic central bank is seen cutting its benchmark rate by 25 bp at its meeting tomorrow.
Key Quotes
“Norges Bank (NB) is set to deliver a 25bp rate cut on Thursday. However, we expect NB to turn to a neutral bias by presenting a new rate path at which the policy rate will be kept on hold until next year”.
“A neutral bias would be much more hawkish than what markets expect”.
“The primary risk to our projection is NB still signalling an easing bias due to a
less ‘straightforward’ view on the oil investment survey or, more tactically, to avoid a stronger NOK”.
“In our view there is a tiny risk that NB could leave the rate unchanged, as the stabilisation in oil investments has reduced the tail risk”.
“We expect a lower EUR/NOK on the back of wider rates spreads, higher oil prices, relative fundamentals, technicals and ECB QE”.
Key Quotes
“Norges Bank (NB) is set to deliver a 25bp rate cut on Thursday. However, we expect NB to turn to a neutral bias by presenting a new rate path at which the policy rate will be kept on hold until next year”.
“A neutral bias would be much more hawkish than what markets expect”.
“The primary risk to our projection is NB still signalling an easing bias due to a
less ‘straightforward’ view on the oil investment survey or, more tactically, to avoid a stronger NOK”.
“In our view there is a tiny risk that NB could leave the rate unchanged, as the stabilisation in oil investments has reduced the tail risk”.
“We expect a lower EUR/NOK on the back of wider rates spreads, higher oil prices, relative fundamentals, technicals and ECB QE”.