VIEW: Nordea Now See Norges Bank On Hold This Month, Cuts In Rate Path Come Q424

Nordea believe that "Norges Bank has a tough choice in December with most factors pointing to an unchanged interest rate. The weaker NOK is the only factor that could result in a rate hike. We expect no hike in December and see the new rate path showing a cut in Q424.”

• In terms of details they flag the following factors as reasons to hold:
• Rates abroad have fallen massively since September, with notable rate cut cycles being priced in for both the Fed and ECB next year.
• The domestic economy has been a bit softer than expected,. Data “indicates that the inflection point for the Norwegian economy could come sooner than Norges Bank assumed in September. However, November unemployment remained lower than expected.”
• Oil prices are lower.
• They see inflation figures lower vs. Norges Bank September assumptions.