Norwegian Krone General Info
In 2016, the Norwegian krone contributed to 1.7% of total foreign exchange market volume, and as such was the world's fourteenth most traded currency. The krone is subdivided into 100 øre and was introduced in the late nineteenth century.
Norway’s economy, and consequently the value of the krone, is heavily reliant on oil and gas prices since nearly half of the country’s total exports are these commodities. The krone is therefore aptly termed a ‘petro-currency’. As of 2016, Norway was the world’s tenth largest oil exporter.
Since 1995, the krone’s lowest valuation against the US dollar came in October 2000 when USD/NOK reached 9.65. The currency was strongest in April 2008 when USD/NOK fell to just 4.94 following a boom in the oil price. Against the euro, since the single currency's introduction in 1999, EUR/NOK has traded between 7.21 and 10.16.NOK Foreign Transfers NOK Travel Money
Norwegian Krone - Recent Performance
By mid-August, the Norwegian krone was up more than 9% on the year against the US dollar, at rates around 7.903 (NOK/USD 0.1265).
July’s break through the significant technical level of 8.0 leaves the krone with plenty of space to appreciate further. July’s low of 7.85 was, at the time, the krone’s strongest level for two years and that low remains within striking distance at the time of this report.
Earlier in the year, the krone had underperformed against its peers – the euro and the Swedish krona – because of a 20% fall in the oil price between January and mid-June. Norway’s currency is heavily influenced by oil and gas prices since exports of these commodities make up half of the country’s total exports. The krone brightened up after oil climbed from $42 to $49 per barrel between mid-June and mid-August.
Against a resurgent euro, the krone did well in July and was holding steady in August. EUR/NOK was trading close to 9.29 (NOK/EUR 0.1076).
In September, Dutch bank ABN Amro predicted that the krone would appreciate 20% against the dollar by the end of 2018, with USD/NOK falling to 6.54. As reasons for the krone’s climb, ABN cited “strong conviction” on future US dollar weakness, future commodity price rises, an improvement in global trade and potential interest rate hikes by Norges Bank. The krone was forecast to appreciate the most of all G10 currencies.