The AUD/NOK currency pair extended losses on Wednesday after softer-than-expected Australian inflation data and ahead of the outcome of Norges Bank’s policy meeting.
Australia’s monthly CPI inflation indicator slowed to 3.7% year-on-year in February, down from 3.8%. Markets had anticipated a repeat of the 3.8% figure, so the outcome represented a downside surprise.
The trimmed mean measure of inflation – closely monitored in the context of Reserve Bank of Australia policy decisions – remained at 3.3% year-on-year. This was also below the market expectation of 3.4%.
The weaker inflation data has reinforced a weaker tone for the Australian dollar, combined with broader softness in commodity-linked currencies.
Economists at ANZ said the latest monthly numbers pointed toward a trimmed mean inflation outcome of 0.9% quarter-on-quarter in Q1, with upside risk.
The RBA recently raised interest rates again, citing what it viewed as elevated domestic inflation pressures.
Meanwhile, Norges Bank is expected to leave its key policy rate without change at 4% at its March 26th meeting.
Norway’s annual inflation has remained well above Norges Bank’s target, which suggests a restrictive monetary policy is still necessary.
Yet, in January, the central bank said interest rates could be lowered later in 2026, in case the economy evolves as projected.
The AUD/NOK currency pair was last down 0.13% on the day to trade at 6.7762.
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