Norway central bank mulls stepping in to prop up falling krona
The Local Norway - [email protected]
Published: 19 Mar, 2020 CET.
Updated: Thu 19 Mar 2020 14:15 CET
The central bank of Norway said Thursday it was considering intervening to stop the fall of the Norwegian krone, which is
taking a beating from the economic fallout of the new coronavirus.
Faced with the risk of recession and a sharp drop in the price of oil, of which Norway is Western Europe's largest producer, the Norwegian krone is buckling under.
Since the beginning of the year, when the currency was already weakened, the dollar has appreciated against the krone by more than 20 percent and the euro by almost 18 percent.
The drop intensified on Wednesday and according to business news site e24.no the currency had never weakened more in a day since the country abandoned its fixed exchange rate regime in 1992.
"In recent days, there has been an extraordinary situation in the market for Norwegian kroner," Norges Bank, the country's central bank, said in a statement.
"Against this background Norges Bank is continuously considering whether there is a need to intervene in the market by purchasing Norwegian kroner," it said.
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Faced with the risk of recession and a sharp drop in the price of oil, of which Norway is Western Europe's largest producer, the Norwegian krone is buckling under.
Since the beginning of the year, when the currency was already weakened, the dollar has appreciated against the krone by more than 20 percent and the euro by almost 18 percent.
The drop intensified on Wednesday and according to business news site e24.no the currency had never weakened more in a day since the country abandoned its fixed exchange rate regime in 1992.
"In recent days, there has been an extraordinary situation in the market for Norwegian kroner," Norges Bank, the country's central bank, said in a statement.
"Against this background Norges Bank is continuously considering whether there is a need to intervene in the market by purchasing Norwegian kroner," it said.
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