The Pound exchange rate fell against the Danish Krone (GBP/DKK) and Norwegian Krone (GBP/NOK) and other major peers after British Prime Minister David Cameron said that an EU Referendum will not harm the UK economy, a view not accepted by traders.
Economic data releases out of Denmark were mixed on Monday with the Scandinavian nation posting softer than forecast Industrial Production and a weaker than expected Balance of Trade of report. Inflation data was also published. Inflation in Denmark came in as forecast at 0.5%.
Norway too saw the publication of inflation data. Data released by Statistics Norway showed that the nation’s inflation rate slowed marginally as forecast in October and producer prices fell for a fourth consecutive month.
Consumer price inflation came in at 2%, down from 2.1% in September. The annual rate was dampened by falling electricity prices.
Producer prices in Norway fell by 3.4% on an annual basis in October due to a decline in the index for extraction of oil, natural gas and electricity. Producer prices were down 3.8% in September. Month-on-month, consumer prices fell 0.2%.
Cameron Comments Soften Pound Exchange Rate
The Pound weakened against both the Scandinavian currencies and softened against the Euro after Prime Minister David Cameron told the annual CBI Conference that a referendum vote on whether the UK should stay in the European Union would not damage the UK economy.
Cameron said that public support for the EU has eroded and that a referendum, preceded by a re-negotiation of the terms of the UK’s membership, was vital to safeguarding the UK’s interests as the EU changed. He insisted he wanted the UK to stay within a reformed EU, one based on “common market and co-operation, not an ever-closer union”.
The CBI said that the prospect of a referendum is causing uncertainty and could deter companies from looking to expand or hire new workers. Other economists are concerned that such a vote could destabilise the UK’s economic recovery.
Sterling Regains Ground Against Danish Krone (GBP/DKK) Exchange Rate
The Pound managed to regain ground against the Danish Krone but trade remained muted due to a lack of economic data releases. Sterling ticked higher as economists raised their bets that Wednesday’s UK employment data and wage growth reports will come in positively. If the data shows that wage growth picked up last month we can expect the Pound to advance against the Danish currency and other major peers.
Against the Norwegian Krone, the Pound remained softer as the Norse currency found supported from a rise in oil prices.
GBP Exchange Rate Tumbles Against DKK and NOK
The Pound fell sharply against both the Danish and Norwegian Krones on Thursday as the currency was hammered lower on Wednesday after the Bank of England lower its growth forecasts for the UK economy and warned that inflation in the country could fall below 1% over the next six months due to weakness in the Eurozone. On Thursday, the Pound continued its declines as a report showed that house price growth declined sharply in October, easing pressure on the BoE to raise interest rates.
Danish Krone (DKK) Exchange Rates
[table width=”100%” colwidth=”50|50|50|50|50″ colalign=”left|left|left|left|left”]
Currency, ,Currency,Rate ,
Pound Sterling,
,Danish Krone,9.3850 ,
Euro,, Danish Krone,7.4488 ,
US Dollar,, Danish Krone,5.9683 ,
[/table]
Norwegian Krone (NOK) Exchange Rates
[table width=”100%” colwidth=”50|50|50|50|50″ colalign=”left|left|left|left|left”]
Currency, ,Currency,Rate ,
Pound Sterling,,Norwegian Krone,10.6569 ,
Euro,, Norwegian Krone,8.4536 ,
US Dollar,, Norwegian Krone,6.7728 ,
[/table]
