Pound Sterling to Norwegian Krone (GBP/NOK) Exchange Rate softer on Manufacturing Data

The Pound (GBP) softened against the Norwegian Krone (NOK) on Friday adding to a run of falls which have been a result of softening data out of the UK and improving data out of Norway.

Earlier the week the Norwegian Krone made gains against Sterling after data showed that unemployment in the Scandinavian country fell unexpectedly in June.

Statistics Norway said that the number of Norwegians out of work fell to a seasonally adjusted annual rate of 3.2%, down from the 3.3% seen in the previous month.

The figure took economists by surprise as many had been forecasting for the jobless rate to rise to 3.4%.

Data published in Friday’s session also lent support to the Norwegian Krone after it showed that manufacturing activity in the county expanded more than forecast in July.

According to Statistics Norway, Manufacturing activity in Norway increase to a seasonally adjusted annual rate of 50.6, up from the previous month’s figure of 49.6. The data was better than the 50.2 level expected by economists.

Any figure above 50 indicates expansion, whilst one below indicates contraction.

The Norwegian Krone advanced against Sterling after the UK currency continued to be weakened by a run of reports which suggest that the nation’s economy is showing signs of a slowdown. A Manufacturing PMI for the UK eased from June’s figure of 57.2 to 55.4 in July.

GBP to NOK Forecast

The Norwegian Krone could come under pressure next week as economists look into the possible implications of the EU imposing sanctions against Russia. With Norway being a major oil supplier its industry has close links to those in Russia.

Although Norway formally is not a member of the EU, its government traditionally follows the guidelines of a united European policy. Norwegian government has been persistent in observing all the EU decisions on sanctions against Russia to date.

The Krone could see volatility if it is deemed that the sanctions could have a negative impact upon the Nordic nations economy.

The next piece of market moving data due for release out of Norway is next Thursday’s Industrial and manufacturing Production data. Both figures are forecast to show improvement.