The GBP/NOK currency pair eased from a fresh 1 1/2-week high of 13.2944 on Friday in the wake of the Bank of England’s policy decision.
The Bank of England left its benchmark interest rate intact at 3.75% at its February 5th meeting, in line with market consensus.
Yet, it was a narrow 5 to 4 vote, as officials weighed easing inflation pressures against risks stemming from a weakening economy.
Four members voted in favor of a 25 basis point cut, which highlighted growing divisions within the Monetary Policy Committee.
BoE policy makers said that risks of persistent inflation had decreased, while weaker demand and a softening labor market posed downside risks.
The MPC indicated that further rate cuts were likely, but they would depend on incoming inflation figures.
BoE Governor Andrew Bailey expressed confidence that inflation would reach the 2% target sooner than previously thought. This stance underscored a more dovish tilt at the BoE relative to prior expectations.
Meanwhile, the latest data out of Norway showed that manufacturing production had shrunk 0.1% month-over-month in December, after a revised down 2% surge in the prior month.
The GBP/NOK currency pair was last down 0.37% on the day to trade at 13.2183.
The Norwegian Krone has also received a boost from higher oil prices, exerting downward pressure on the exotic currency pair.
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