Norway economic outlook: Inflation in focus

Sweden economic outlook: Staying the course

Norges Bank hikes and keeps guidance hawkish

The desk views the Norges Bank's recent 25 basis point hike to 4.25% as a clear signal of its commitment to combating inflation, which is now seen as a broader concern beyond geopolitical tensions. Per the full note from ing-think, while a hold is anticipated in June, the central bank's hawkish guidance suggests the possibility of another rate increase by year-end. This aligns with our bearish outlook on EUR/NOK, as we expect the krone to strengthen against the euro in the coming months. The current consensus among firms indicates a target range for EUR/NOK that supports this view, with no immediate calendar events expected to disrupt this trajectory.

War in the Middle East and its economic impact

Norges Bank hikes and keeps guidance hawkish

The recent decision by Norges Bank to hike rates and maintain a hawkish guidance underscores a robust approach to inflation management. This aligns with the broader market expectations of continued monetary tightening throughout the region.