GBP/NOK settles above 25 1/2-month low, posts weekly loss

The GBP/NOK currency pair settled above recent low of 12.8820, its weakest level since December 27th 2023, as soft UK GDP growth added to Bank of England rate cut expectations.

Preliminary data by the Office for National Statistics showed UK’s GDP had expanded 0.1% quarter-on-quarter in Q4. Although the figure matched the previous quarter’s pace, it fell short of market consensus of a 0.2% growth.

And, in annual terms, GDP growth slowed to 1.0% in Q4 from 1.2% in the prior period.

Overall, the data implied the UK economy lost momentum toward the end of 2025, reinforcing concerns over fragile growth.

Markets are now pricing in a higher probability of an interest rate cut by the BoE as early as March.

Subdued activity and easing inflation risks are likely to provide the central bank with more room to act.

Meanwhile, in Norway, annual CPI inflation has picked up to 3.6% in January, the latest data showed, from 3.2% in December. It has been the highest inflation rate since September 2025.

And, Norway’s annual inflation adjusted for tax changes and excluding energy products (CPI-ATE) has accelerated to 3.4% in January from 3.1% in December.

Inflation has remained well above Norges Bank’s target, which suggests a restrictive monetary policy is still necessary.

The exotic Forex pair lost 1.57% for the week.