NOK flows: Usual Monday oil bounce, EUR/NOK sitting on support
EUR/NOK still pressing support area after 'usual' weekend negative comments and oil bounce. More downside scope on spreads.
No real surprises from Norway CPI as core comes in at 3.2%y/y from 3.0% in line with market and central bank expectations and the monthly underlying core trend still not looking a big problem as it stands.
Nonetheless, with the negative tone of weekend news on Iran and oil back firmer (following the noted usual Monday pattern), EUR/NOK back to pressuring the 10.8~ area support which is also around the 50% retracement. That’s still what sits in front of moving back into the band back to 10.5~ (fig and 61.8%).
As noted in the Weekly, there’s still plenty of downside room on the cross to move back more in line with spreads. For now Iran headlines will still be calling most of the shots and there's an increasing reluctance to swing too sharply on every comment, given the continued noise.