Norwegian Krone Shows Mix Performance
The Norwegian Krone plummeted 9% on the FX Market Thursday following the COVID-19 outbreak and the sharp dip in oil price. Economic indicators in Norway are following the oil price decline of more than 25% this week. However, it then rose on Friday even after the Norges Bank cut interest rates.
As a barrel of oil dipped under $33 Thursday, Norway’s currency followed, shaking its economy. Today, 1USD is to 9.89 krone, and a euro is to 11.06. Oslo Stock Exchange continued to fall to 8.77% Thursday.
When the index was at its highest on January 17th, the stock market in Norway has been down more than 30%.
Norges Bank announced a rate cut to 1% from 1.5% on Friday to combat the COVID-19 fallout.
COVID-19 has Hurt Businesses in Norway
The Norwegian Krone strengthened on Friday forcing the GBP/NOK rate back from multi-year highs, even after its central bank’s rate cut.
Forex and businesses in Norway have suffered from the blows of the current global crisis. On Thursday, the government shut the schools and universities to prevent more infections from the COVID-19. It has locked down establishments where public events and gatherings happen including sport halls and company canteens.
Restaurants no longer serve buffet and they have restricted travel. Public sector employees have cancelled their meetings. Directorate of Health issued a statement encouraging their citizens to work from home in order to avoid public transport and close contact with others.
Moreover, everyone coming from outside the Nordic countries should be in quarantine for 14 days from their arrival. The Directorate of Health has made this retroactive beginning February 27.
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Economic Crisis Affects Society in Norway
The krone and FX trading are likely to stay volatile with a risk of economic downturn.
The Norwegian government has encouraged its people to cancel social events such as conferences and concerts all over the country.
In more news, Finnmarksløpet, Europe’s longest dogsled race across the wilderness on the top of Norway was announced its stoppng on Thursday.
Airlines like Norwegian Air Shuttle and SAS have cancelled bookings. Norwegian Air Shuttle said Thursday it will cancel 4,000 flights. The company also announced a temporary laying off of up to half of its staff.
Following Trump’s 30-day travel ban from Schengen Europe, 40% of Norwegian’s fleet of long-haul Boeing 787 Dreamliner would be grounded.
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