DN takes an aggressive approach to weaken DKK – Danske Bank
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The Danish central bank sanctioned an interest rate hike of 35 bps. This is 15 bps lower compared to the hike from the ECB and should be enough to weaken the DKK, according to economists at Danske Bank.
“Danmarks Nationalbank (DN) hikes 35 bps to 2.10% in response to ECB’s 50 bps rate hike.
“DN hiked 15 bps less and widened the spread to -40 bps in response to a period of downward pressure on EUR/DKK.”
“We expect this to be enough to weaken DKK and the need for FX intervention.”
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