Nordea sees usdnok draw back and eurnok upside

EURNOK — upside danger (base case dips towards ~11.75 first)

• Commerce thought from the financial institution: Go lengthy EURNOK on a clear break and maintain above 12.00, or purchase dips into seasonal late-year NOK softness; keep away from structural NOK longs for now.

• Why:

  • Norges Financial institution set to chop in September and preserve easing → weaker NOK carry assist.

  • Potential ECB hawkish flip subsequent 12 months on fiscal-led inflation dangers → wider EUR–NOK differentials.

  • Oil headwinds: OPEC provide will increase and near-term surplus lean NOK-negative.

  • Seasonality: NOK sometimes weakens into autumn/December.

USDNOK — draw back danger (medium-term)

• Commerce thought from the financial institution: Brief USDNOK on rallies (current provide 10.2–10.three), with a medium-term bias towards ~9.43 by end-2026.

• Why:

  • US financing pressure: Larger deficits and heavier Treasury issuance as main holders step again → want for greater yields and/or weaker USD.

  • Exterior steadiness combine: Excessive share of US liabilities in authorities paper heightens USD depreciation danger.

  • Relative development and flows: Larger US tariffs may cool US demand whereas euro-area fiscal push attracts capital away from the US, pressuring the USD.

This text was written by Arno V Venter at investinglive.com.