Commodity-heavy currencies lead in early Asian trade.
The Norwegian krone has been weak for a long time, but on Sunday evening in Norwegian time it is making a small jump against the dollar.
The krone rose 0.4 percent against the dollar, and one dollar was trading on Sunday evening at around NOK 10.43, according to bloomberg. At most, the krone rose about 1% against the dollar.
The krone is leading among several commodity-heavy currencies, Bloomberg writes, which strengthened in early currency trading in Asia, after the OPEC+ announcement of oil production cuts on Sunday.
The eight OPEC+ countries of Saudi Arabia, Russia, the United Arab Emirates, Iraq, Algeria, Kuwait, Oman and Kazakhstan will collectively cut more than 1.6 million barrels of oil per day from May until the end of the year.
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Other sources, such as Google Finance, report larger impacts in the krone exchange rate against both the dollar and the euro.
Kjetil Olsen, chief economist at Nordea, previously explained that there is a relationship between the oil price and the krone exchange rate.
Thus, a drop in the price of oil leads to a weakening of the krone, but it can also work in the opposite direction.
Oil analyst Bjarn Schildrup says Sunday’s oil cut from OPEC+ countries came as a complete surprise to the market, and will likely cause the price of oil to drop between $5 and $10 when it opens for trading on Monday.
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