Norway’s central bank is predicted to leave its key policy rate unchanged at a record low as the economy of western Europe’s biggest oil producer fights off the biggest slump in crude prices in a generation.
Norway's sovereign wealth fund has banned Cairn Energy and Kosmos Energy from its portfolio due to their business in the disputed territory of West Sahara.
The watchdog overseeing banks in western Europe’s biggest oil exporter says Norway’s financial industry may still be underestimating the risk of losses, even after a 70 percent recovery in crude prices since January.
Nicola Sturgeon has said she was “not aware” of allegations of corruption against the parent company of a Chinese firm she has signed an investment agreement with.
Norway’s central bank raised krone purchases by 80 percent to a record in February as Scandinavia’s richest nation takes a hit from the collapsing price of Brent crude.
The world’s biggest wealth fund won’t be joining its counterparts in a selloff that’s hurting already depressed markets.
In fact, officials who supervise the $780 billion fund haven’t even discussed the possibility of shifting strategy, according to Egil Matsen, who this week started as the new deputy central bank governor in charge of oversight of the investor.
Norway’s central bank can probably sit out the global currency war that is now at its doorstep.
Even a potential intervention in neighboring Sweden is unlikely to boost the Norwegian krone as a deepening rout in Brent crude drags down the currency of western Europe’s biggest crude producer.
“At the end of the day, the Norwegian krone is oil- fixated,” said Daragh Maher, head of currency strategy for HSBC in New York. “Really, the issue is whether the oil price can find a bottom.”
A decision by the Norwegian minority government to start making withdrawals from the country’s sovereign fund could mark a “radical change” for the region.
Leading expert Professor Jon Kleppe, from the Norwegian University of Science and Technology in Trondheim, said the sovereign fund has risen from NOK 6300billion at the start of the year to NOK 7000billion.
He said the increase was largely down to the weakening of the Norwegian Kroner next to the US dollar.