Norwegian krone faces increased volatility risk; analysts warn that rate hike expectations may be overestimated

Golden Ten Data reported on March 4 that Antje Praefcke from Commerzbank stated in a report that the Norwegian krone faces downside risks after its recent strengthening. Currently, the krone is one of the best-performing currencies, mainly supported by market expectations that the Norwegian central bank may raise interest rates. This follows inflation data that exceeded expectations and the rise in oil prices caused by the US-Iran conflict. However, she noted that if upcoming data fails to confirm the upward trend in inflation, rate hike bets may cool down. She believes that once the conflict eases and the Strait of Hormuz reopens, it will trigger a rapid correction in oil prices and the krone.