Pound Norwegian Krone (GBP/NOK) Exchange Rate Edges Up as 1922 Committee Rules out Early Leadership Challenge
The Pound Sterling Norwegian Krone (GBP/NOK) exchange rate rose, and the pairing is currently trading at an inter-bank rate of 11.1680Kr.
On Wednesday evening, senior Conservatives ruled out changing their rules to allow an early challenge to the Prime Minister’s leadership.
However, the Conservative 1922 Committee said that Theresa May should say when she will resign if her Brexit deal does not get passed.
Chair of the Committee, Sir Graham Brady said MPs requested a ‘clear roadmap’ about May’s future.
Commenting on the decision, former Minister Robert Halfon said that it would be ‘entirely wrong’ to table a motion of no-confidence while the Brexit uncertainty continues.
Sterling (GBP) Rises as Government Borrowing Hits 17-Year Low
Yesterday, data from the Office for National Statistics (ONS) revealed that government borrowing in the UK fell to a 17-year low.
In the 2018-2019 financial year, borrowing was revealed to sit at £24.7 billion, £17.2 billion less than the previous year.
Despite this, the amount was still higher than the Office for Budget Responsibility’s forecast from last month.
Meanwhile, Chancellor Philip Hammond has promised a cash boost for the health sector and even said an end to austerity is within sight.
However, it remains uncertain just how far Hammond can go, as Brexit uncertainty continues to be the dark cloud looming over the economic outlook.
Norwegian Krone (NOK) Falls despite Boost in Oil Prices
At the start of the week, the Norwegian Krone was boosted by the sharp rise in prices of crude oil.
In a statement from the White House, the US said they were ending all exemptions for sanctions against Iran.
This boosted global oil prices, and saw the oil-sensitive Krone rise at the start of this week’s session.
However, it is likely the Norwegian currency fell later in the week as oil prices fell and risk appetite diminished.
Commenting on the expectations of oil prices, Capital Economics stated:
‘[It expected] oil prices to fall this year as sluggish global growth weighs on oil demand, US shale output grows strongly and investor aversion to risk assets like commodities increases.’
Pound Norwegian Krone Outlook: Will Cross-Party Talks Cause the GBP/NOK Exchange Rate Rise?
Looking ahead to the rest of the week, it is likely the Pound (GBP) could continue to rise against the Norwegian Krone (NOK) following positive reports of progress during cross-party discussions.
If reports suggest that cross-party discussions are progressing successfully, and the Conservatives are willing to shift on its ‘red lines’, sentiment in Sterling could rise.
At the start of the week, the Norwegian Krone was boosted by the surge in world oil prices.
If oil prices rise further as a result of US sanctions on Iranian oil, the Pound Norwegian Krone (GBP/NOK) exchange rate could fall.