 You can now buy more Norwegian Kroner for the Euro than ever before. PHOTO: SCANPIX |
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"The present exchange rate is historic and the NOK is trading at an incredibly low level," says economic analyst at NORDEA bank, Ole Håkon Eek-Nielsen to business news websiteE24.
"The Euro is at an all time high relative to the NOK. We have seen rates of NOK 8.95 to the Euro. In a short space of time there has been as much movement in the price as we are likely to experience in a year," says Eek-Nielsen.
"In effect the NOK rate has fallen by 5 percent since the latest Bank of Norway interest rate meeting and by twice this amount since the early summer," said Svein Gjedrem, the head of the national bank, at a press conference after the rate setting meeting on Wednesday.
"Volatility dominates the currency markets. Uncertainty with relation to the NOK and international exchange rates is very high," writes analyst Maren Romstad who works for DnB NOR bank.
She points out that big international traders withdraw from smaller currencies with less liquid markets in times of uncertainty. This is what is happening at the moment.
Nevertheless, she thinks that the currency markets will become less agitated and that as a result the NOK will become stronger again. She refers to Gjedrem who also expected the weakened NOK to recover once the present "special situation" had passed.
Sven Goll
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