The USD/NOK currency pair was hovering above a fresh 15-week low of 9.8941 on Thursday ahead of US GDP growth and PCE inflation data prints and after Norges Bank kept borrowing costs on hold.
Norges Bank left its key policy rate without change at 4% at its January 22nd meeting, in line with market consensus.
The central bank said interest rates could be lowered later in 2026, in case the economy evolves as projected.
Norway’s annual CPI inflation picked up to 3.2% in December from 3% in November, according to the latest data. It has been the highest inflation rate since September.
And, annual inflation adjusted for tax changes and excluding energy products (CPI-ATE) accelerated to 3.1% in December.
Inflation has remained well above Norges Bank’s target, which suggests a restrictive monetary policy is still necessary.
Still, the central bank reaffirmed its December rate projection, pointing to one or two rate cuts this year, despite heightened geopolitical uncertainty.
Investor focus now sets on November’s US Personal Consumption Expenditures data, the Federal Reserve’s preferred inflation measure, for more clues on monetary policy path.
The final estimate of US GDP growth for Q3 and the weekly report on jobless claims will also be closely examined.
Investors are currently expecting at least two rate cuts by the Fed this year, starting as early as June.
The USD/NOK currency pair was last down 0.40% on the day to trade at 9.9067.
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