OSLO Oct 6 The Norwegian central bank will
increase its daily purchases of Norwegian crowns next year, two
economists said on Thursday, after the government presented a
2017 budget that will use more money from the wealth fund than
in the current year.
The central bank is selling foreign exchange because the
government's transfers to its sovereign wealth fund have been
smaller than before and the national budget is using more of the
country's oil-related income.
On Thursday the government said it would use 3.0 percent of
the value of the sovereign wealth fund in 2017, or 225.6 billion
crowns, up from 2.8 percent and 205.6 billion crowns this year.
"We expect daily crown purchases by the central bank of one
billion crowns per day," DNB Markets said in a note to clients
after the budget was presented. Bank SEB said it would expected
daily crown purchases to increase, without specifying a level.
Nordea Markets separately said the central bank may raise
its purchases as a result of the budget, but added it was "far
The central bank has been selling foreign exchange
equivalent to 900 million Norwegian crowns ($111.81 million) per
day since January.
($1 = 8.0494 Norwegian crowns)
(Reporting by Ole Petter Skonnord and Camilla Knudsen, editing
by Gwladys Fouche and Terje Solsvik)