The past week saw the Pound Sterling to Norwegian Krone (GBP/NOK) exchange rate climb from a low of 12.6908 to a high of 12.9582. The pairing has continued to climb this week, after the Pound recovered from a sharper slowing in UK wage growth than anticipated.
Last week, the Pound ended the European trading session in a strong position against the Krone, having suffered a huge dive following the announcement of the UK Employment Change and Average Earnings figures for the three months through to June. The Pound plunged from its weekly high of 12.9432 down to its corresponding low of 12.6908.
The Pound recovered in a relatively short space of time, however, and rose against the Krone once again. This recovery from the negative UK employment results coincided with another dip in the price of crude oil, one of Norway’s key exports. Crude oil posted just above $42 per barrel on Wednesday, and the Krone’s performance was accordingly damaged.
The Pound continued to gain against the Krone on Thursday, although Friday’s advance was initially impaired by the UK monthly and yearly Construction Output figures for June. Despite both printing positively, the figures were significantly below the expected numbers and the Pound dipped shortly after the announcement to 12.7692.
The Pound ended the week on a high of 12.8973, which came after the release of a range of US economic figures. Although the most important of these, the University of Michigan Confidence survey score for August, failed to meet with expectations, the Manufacturing and Industrial Production results for July both came in above forecasts, which increased the strength of the ‘Greenback’ overall. With this gain for the US Dollar the Krone fell in value, as the pricing of crude oil was once again damaged by a strong performance from the US currency.
This week, Pound Sterling/Norwegian Krone (GBP/NOK) exchange rate movement may occur as a result of the UK annual CPI for July, the US annual CPI for July, the UK annual Retail Sales figure for July and the Norwegian yearly and quarterly Q2 GDP data. The UK CPI is due to stagnate, which won’t do the Pound any favours, as speculators are hoping for a rise to promote a UK Interest Rate increase. The US result (due on Wednesday), however, is predicted to increase slightly; if accurate, this will raise confidence in the Dollar and subsequently lower the price of commodities including Norwegian crude oil. The UK Retail Sales figures (out on Thursday) have been optimistically forecast, but so too have the Norwegian GDP results (out on the same day), so these two potential positives may cancel each other out if they don’t exceed expectations.