5 votes

Norway's economy is thriving yet the krone is becoming less and less valuable. What's going on?

Posted by mycketforvirrad
Tags: economics, norway, economy, currency, krone, imports, inflation, analysis, source.economist, paywall
https://www.economist.com/finance-and-economics/2024/09/12/norways-weak-currency-presents-a-mystery

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Title
Norway's weak currency presents a mystery
Published
Sep 12 2024
Word count
127 words

2 comments

  1. stu2b50
    Link
    The two aren't really linked, so I'm not sure what the confusion is. The value of your currency has more to do with your trade imbalances than the strength of your economy. In particular So, uh,...

    The two aren't really linked, so I'm not sure what the confusion is. The value of your currency has more to do with your trade imbalances than the strength of your economy. In particular

    In a country that imports almost all its consumer goods, this has added to inflationary pressure.

    So, uh, is it not expected that a country that imports all of its consumer goods has a weak currency? Or rather, if that's a constant, then it's a constant force dragging the krone down - if exports, mostly oil, for Noraway - weaken even slightly then it's only natural for the krone to go down with it, regardless of how well the economy is doing.

    6 votes