Bloomberg News

Krone Posts Biggest Gain Since February on Growth: Oslo Mover

May 22, 2012

Norway’s krone had its biggest gain in more than three months after economic growth accelerated more than estimated in the first quarter.

The krone rose as much as 0.8 percent, the biggest gain since Feb. 10. It was up 0.7 percent to 7.5630 per euro as of 5:42 p.m. in Oslo.

Economic growth accelerated more than estimated in the first quarter as investments in offshore oil and gas fields allowed Europe’s second-largest crude exporter to evade the region’s debt crisis, data showed today. Gross domestic product, excluding oil, gas and shipping output, grew 1.1 percent, after a 0.8 percent expansion in the period through December, Oslo- based Statistics Norway said. Growth was seen at 0.9 percent, according to the median estimate of 11 economists in a Bloomberg survey. Total output was 1.4 percent.

The currency hit a four-month low against the dollar and a three-month low against the euro last week amid concern over a deepening European debt crisis. It gained 0.1 percent to 5.9358 per dollar today, climbing for a third day.

The krone hit a nine-year high against the single European currency in March as investors sought refuge from the European debt crisis. Krone gains prompted an unexpected interest rate cut in March and a warning from Norges Bank Governor Oeystein Olsen that increased risk aversion may lead to a krone squeeze.

The central bank has cut its benchmark rates by 0.75 percentage point since December, reaching 1.5 percent, in part to weaken the currency.

To contact the reporter on this story: Stephen Treloar in Oslo at streloar1@bloomberg.net

To contact the editor responsible for this story: Jonas Bergman at jbergman@bloomberg.net


Best LBO Ever
LIMITED-TIME OFFER SUBSCRIBE NOW
 
blog comments powered by Disqus