GBP/NOK Turns Bearish As Norway’s Manufacturing Figures Improve

GBP/NOK Turns Bearish - norwegian flag
Bill Cascade   NEW 11/06/2019 00:00:00 Forex

The GBP/NOK currency pair kicked off this week on a bullish rally on Monday's trading session which indicates a correction from the bearish performance that was observed on Friday.

The GBP/NOK's bearish trend on Friday happened after the announcement of positive manufacturing data from Norway for April. The report indicated that the Norwegian manufacturing figures rose from 0.7% in March to 2.2% in April. The bearish trend on Friday due to the stronger Norwegian Krone in response to the positive manufacturing data. The exchange rate turned bullish on Monday, perhaps because on Monday because it is a holiday for Norwegian banks and it is known as Whit Monday. This gives the GBP more room to dominate.


The Krone is particularly sensitive to changes in economic data, and because Norway relies heavily on oil prices, oil, therefore, has a major impact on the currency. The rising oil prices on Friday contributed to the NOK's performance, which continued to move from its five-month lows.

Oil prices started going up after OPEC announced that it might extend crude oil cuts and also after the U.S. announced plans to delay tariffs against Mexico.

“After prices hit the depth of the sewer this week, and (are) arguably in oversold territory, traders were always going to be predisposed to book profits ahead of the weekend,” stated Stephen Innes, Vanguard Markets’ managing partner.

GBP held back by economic and political uncertainties

The Norwegian Krone’s strength was further enforced by the Great Britain Pound’s (GBP) failure to reap the benefits of the UK Halifax house report which indicated a 0.5% surge in May. The GBP’s failure to perform on the news was likely influenced by the ongoing economic and political uncertainties which have hugely affected trade in the European region. Brexit is one of the major issues that have held back the GBP over the past few months, during which investors took a cautious approach.

As for the future outlook, market experts expect the uncertain nature of the market to prevail, especially as British Prime Minister Theresa May steps down this month. There is uncertainty about the country’s economic stance of the incoming Prime Minister as well as the future relationship between the European Union and the UK.

The GBP/NOK is expected to react to the release of Norwegian inflation data today. If the data released will be positive, then there is a likelihood that it will strengthen the Norwegian Krone, thus, potentially influencing a strong bearish trend in the GBP/NOK. The chart might also turn bullish if the data released end up being negative.

Meanwhile, the GBP/NOK’s exchange rate performance is still mainly at the mercy of Brexit. Brexit is the major determinant that influences the exchange rate performance of the currency pair. There are fears of a wide Brexit-fueled political rift, especially with the recent parliamentary EU elections.

These issues have further contributed to a weaker GBP because traders are concerned about investing at such times. However, there is still hope that the high political climates will cool down soon as the Brexit issue approaches its conclusion.





More articles

US Dollar Under Pressure On Weak Economic Data

Bill Cascade   NEW 09/10/2019 00:00:00 Forex

The US dollar is struggling for direction, having lost momentum on weak employment data. The greenback has registered impressive gains, in recent months, as other majors currencies continued to edge lower...

Buy to Open Definition, Explained in Detail with Example

Bill Cascade   NEW 08/10/2019 00:00:00 Guides

There are four types of options that are commonly used in the industry. Alongside buy to open, these include buy to close, sell to open and sell to close. Here we look at precisely what the basic definition of buy to open means, alongside offering an example of it at work. By analyzing the term further, we can provide a better understanding...

Swiss Franc Eyes Fresh Gains On Safe Haven Appeal

Bill Cascade   NEW 07/10/2019 00:00:00 Forex

The Swiss franc has lost some ground against other major currencies in recent trading sessions. For starters, it is trading at two-week lows against the Euro, which has tumbled to two-year lows in recent months. While the weakness of the Swiss franc stems from weak economic data, a bounce-back could be in the offing going forward...

Turkish Lira On The Recovery As Swedish Krona Woes Persist

Bill Cascade   NEW 06/10/2019 00:00:00 Forex

Turkey's government remains optimistic about the Lira appreciation, against the dollar, over the next three years. Economic forecasts by the finance ministry indicate the government expects the country’s economy to expand by 5% next year...

Argentines Turn To the Polls To Avert Economic Crisis And Peso Volatility

Bill Cascade   NEW 03/10/2019 00:00:00 Finance

The country is struggling with one of the highest levels of inflation at 54%. High inflation levels have affected the way of life, as prices of goods continue to rise, and small businesses struggle to remain afloat... 

Free margin - Credit