What does the data mean to the market?
The Norges Bank decision on where to set the benchmark interest rate. Traders watch interest rate changes closely as short term interest rates are the primary factor in currency valuation.
A higher than expected rate is positive/bullish for the NOK, while a lower than expected rate is negative/bearish.
Historic deviations and their outcome
June 18 2020 7th May 2020
A further cut of 0.25% leaving interest rates at an unprecedented 0.00%
March 19 2020 20th March 2020
A further emergency cut of 0.75% to the interest rate, Leaving interest rates at 0.25%
NO Interest Rate Decision 2020-03-20 07:30:00.0
March 19 2020 13th March 2020
An emergency cut of 0.50% to the 1.5% interest rates due to the global pandemic unfolding and the expected significant expected impact on the economy is the first cut to interest rates since 2016
The world started to go into a meltdown as the realisation of a global pandemic began to unfold. There is no surprise the reaction to this was so poor, not even a blip on the charts.
Due to the unprecedented times this first in a series of emergency cuts which doesn't create anything near the reaction we would likely see if a cut of this nature happened in normal times. A reminder of the impact Covid had in 2020, which I'm glad to say is now behind us, and I'll be watching these announcements now and looking for a normal reaction to the data as it's released.
NO Interest Rate Decision 2020-03-13 07:30:00.0
I will use forecasts of:
Interest Rate Decision 0.75
Today's trade plan
Today it is forecast for the rate to remain at 0.75%. All economists predict this therefore, I will take a buy if they hike to1.00% or a sell if they cut the rates to 0.50%
This equates to a +/- 0.25% Deviation from the forecast of 0.75%
Hope this helps but please do your own analysis!!
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