USD/NOK at 21-week low as Norway CPI rises to 10-month high

Key moments

The USD/NOK currency pair plummeted to a fresh 21-week low on Monday, after data revealed a sharp acceleration in Norwegian consumer inflation and as tariff worries weighed on risk sentiment.

Market players have been focused on trade tensions, as US President Trump imposed tariffs on key trading partners, and then, delayed some of them for one month amid growing concerns over a US economic slowdown.

In an interview with Fox News over the weekend, Trump abstained from predicting if the US could be heading towards a recession amid stock market worries about tariff actions on Mexico, Canada and China.

The yield on 10-year US Treasuries dropped to 4.251% from 4.305% on Friday, mounting pressure on the greenback.

“FX investors are in a broad de-risking mode,” Parisha Saimbi, Asia-Pacific rates and Forex strategist at BNP Paribas, was quoted as saying by Reuters.

The US Dollar hovered above a multi-month low against major peers, after data showed on Friday that the US economy had added fewer than expected jobs last month.

Employers in all sectors of the US economy, excluding farming, added 151,000 job positions in February, following the revised down 125,000 in January and against market consensus of 160,000.

The data implied the Federal Reserve was still on track to deliver multiple interest rate cuts this year. Markets are now pricing in at least three 25 basis point rate cuts for 2025. The first rate cut is likely to come as early as June.

This week, investors’ focus will likely set on the US job openings, CPI inflation and producer price inflation figures due on Tuesday, Wednesday and Thursday respectively.

Norway CPI inflation highest since April 2024

Meanwhile, the latest data out of Norway showed that annual consumer price inflation had picked up to 3.6% in February from 2.3% in the prior month, far exceeding market consensus of 2.8%. It has been the highest inflation rate since April 2024.

Norway’s annual inflation adjusted for tax changes and excluding energy products (CPI-ATE) also accelerated – to 3.4% in February from 2.8% in January.

The latest data suggested that Norges Bank might have limited scope to cut interest rates further this year.

The USD/NOK currency pair was last losing 0.82% on the day to trade at 10.7477. Earlier, the exotic Forex pair went down as low as 10.7406, or its lowest level since October 14th 2024.