Norwegian Krone Headed for Worst Week This Year as Oil Tumbles
(Bloomberg) -- Norway's krone is headed for its worst week this year as U.S. President Donald Trump ratcheted up threats in a trade war with China, roiling global commodities.
The krone is down about 2% this week, sliding as much as 0.7% to 9.91 per euro on Friday, the lowest level since Jan. 3.
The tumble comes as the price of Brent crude has slid almost 3% this week along with other commodities after Trump threatened new tariffs on Chinese goods, raising the stakes in a dispute that's hurting global growth and demand for commodities. Norway is Western Europe's biggest producer of petroleum products and gets almost half of its goods exports from oil and natural gas.
Weak economic data released this week have also weighed on the krone, with a purchasing managers' index showing a contraction in overall activity, retail sales falling, household credit growth slowing and registered unemployment rising more than estimated in July.
Norway's central bank has signaled it's prepared to raise interest rates again as soon as September. Governor Oystein Olsen's commitment to tightening has surprised markets with a more hawkish outlook three meetings in a row. In June, he raised the key rate for a third time in less than a year, and signaled that another increase could come next month.
| Norway Rushes to Hike Interest Rates Before Oil-Stoked Boom Ends |
To contact the reporter on this story: Mikael Holter in Oslo at mholter2@bloomberg.net
To contact the editor responsible for this story: Jonas Bergman at jbergman@bloomberg.net
©2019 Bloomberg L.P.
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