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TD Securities Recommend New EUR/NOK Short Position

NOK

TD Securities issue new trade recommendation: Short EUR/NOK. They eye a 9.45 target, with a stop at 10.05.

  • TDS write that the Norges Bank might need to allow a bit more FX strength to boost the effectiveness of rate hikes going forward.
  • They add that the broad trade-weighted NOK runs a 3.25% discount to equity markets and Norway's local terms of trade. As such, NOK looks underpriced at current levels.
  • Plugging that valuation gap would anchor EUR/NOK at around target of 9.45. The next few weeks could see the valuation gap close.
MNI London Bureau | +44 203-865-3809 | edward.hardy@marketnews.com
MNI London Bureau | +44 203-865-3809 | edward.hardy@marketnews.com

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