EUR/NOK to hover around 9.50-9.95 as oil prices underpin the krone – Credit Suisse

The Norwegian krone has managed to rally against most majors in the past two weeks despite Brent crude selling off 10% in the same period. Strategists at Credit Suisse lower their EUR/NOK target range to 9.50-9.95.

Oil prices will remain the key determinant of NOK price action

“In the near-term, we struggle to see a catalyst for an idiosyncratic pullback in energy prices. As such, Norway’s oil exposure looks to continue to be a tailwind for NOK.”

“Disruptions to Russian energy supplies, the looming threat of EU sanctions, and attacks on Saudi oil facilities all suggest oil supply will remain tight. In absence of any indication of resolutions for the aforementioned issues, we are biased to expect more EUR/NOK downside in the near-term.” 

“We lower our EUR/NOK target range to 9.50-9.95, from 9.70-10.15 previously.”