GBP/NOK Exchange Rate Sinks as Oil Prices Boost NOK
The Pound Norwegian Krone (GBP/NOK) exchange rate is down by 0.4% today and is currently trading around 10.9960kr on the interbank market.
The Norwegian Krone (NOK) rose against the Pound (GBP) following the printing of the Norwegian manufacturing output figures for April, which rose against the previous month’s -0.7 to 2.2%.
NOK, which is particularly sensitive to oil prices with Norway’s economy reliant on oil exports, has benefited today from rising prices, moving further away from 5-month lows.
This came following a report that the US would postpone its tariffs on Mexico, and with OPEC announcing that it may extend crude cuts.
Stephen Innes, a Managing Partner at Vanguard Markets, said:
‘After prices hit the depth of the sewer this week, and (are) arguably in oversold territory, traders were always going to be predisposed to book profits ahead of the weekend.’
The Pound, meanwhile, failed to benefit from the UK Halifax house prices figures for May, which rose by 0.5%.
Russell Galley, a Managing Director at Halifax, commented:
‘Despite the ongoing political and economic uncertainty, underlying conditions in the broader economy continue to underpin the housing market, particularly the twin factors of high employment and low interest rates.’
GBP/NOK Exchange Rate Falls as Brexit Uncertainty Holds Back Sterling
Sterling has struggled today with uncertainty rising around Brexit and the future leader of the Conservative Party, leaving many Pound traders feeling jittery.
Meanwhile, Labour won its seat in Peterborough despite the Brexit Party being the favourites to win, restoring some confidence that there may be some resistance against a no-deal Brexit scenario.
Jeremy Corbyn, the Leader of the Labour Party, said:
‘This result shows that in spite of the divisions and deadlock over Brexit, when it comes to a vote on the issues that directly affect people’s lives, Labour’s case for real change has strong support across the country. I look forward to welcoming Lisa to parliament next week.’
However, as the week closes – and Theresa May steps down as leader of the Tories – Sterling traders are feeling gloomy, as there has not been any definitive light shed on the UK’s future relationship with the EU.
GBP/NOK Outlook: Brexit Developments and Norwegian Inflation Data in Spotlight
Norwegian banks will be closed on Monday for Whit Monday, a Norwegian bank holiday.
Sterling traders, however, will be looking ahead to Monday’s GDP figures for April.
Monday will also see the publication of the UK manufacturing production figures for April, which are, however, expected to ease.
Tuesday, meanwhile, will see a slew of Norwegian inflation data, and with any signs of improvement, this could buoy the NOK/GBP exchange rate higher.
The Pound Norwegian Dollar (GBP/NOK) exchange rate will remain dictated by Brexit developments, however, and with any signs of a breakthrough this could benefit Sterling as the parliamentary stalemate is challenged.