The relentless decline in oil prices, caused by persistent over-supply and weak demand, continues to favour further depreciation in commodities currencies. The latest evidence was given by the Norwegian central bank who decided on 11 December to cut rates to counterbalance the negative spillover from its domestic petroleum industry. On the same day, the Swiss National Bank decided to leave its monetary policy unchanged while reiterating its commitment to defend the 1.20-floor. Such unchanged communication is unlikely to occur at the next FOMC meeting, as the Fed needs to prepare financial markets to the probable start of its tightening cycle in 2015.
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