Norges Bank to cut rates, back to neutral stance – Danske Bank

FXStreet (Edinburgh) - Allan von Mehren, Chief Analyst at Danske Bank, sees the Nordic central bank cutting rates by 25 bp, although signaling a return to a neutral stance afterwards.

Key Quotes

“Today’s big event in the Scandies is the Norges Bank (NB) monetary policy meeting”.

“While a 25bp cut has been fully priced, market pricing of future NB policy is much too dovish in our opinion”.

“We expect NB to return to a neutral stance, to lift the rate path/projection across the curve and signal that there will be no more cuts”.

“If we are right in our call this would send the NOK significantly higher”.