- We expect Norges Bank to purchase FX corresponding to NOK550m per day in November. As the market seems to expect a higher figure, this should support the NOK.
- Last year, the daily purchase increased from NOK550m per day in October to NOK1,600m per day in November. However, in 2011, the assumptions on the relevant cash flows changed dramatically from the Revised budget to the National budget, lifting the estimated FX purchases for 2011 by more than NOK30bn. This year, this effect is less than NOK1bn.
- As usual, these calculations are subject to uncertainty. Based on some simple assumptions, we estimate the possible range at NOK200-1,100 per day. However, there are some strong indications that we will end up at the lower end of the range.
Basically, it is straightforward to calculate annual FX purchases from Norges Bank on behalf of the Petroleum Fund. The annual transfer to the Fund is presented in the National Budgets. As the FX revenue from the State’s direct financial interest (SDFI) is transferred directly to the Fund, the annual FX purchases from Norge Bank will be the difference between the total transfer and the FX revenue from SDFI, as illustrated in Figure 1 later in this publication. For 2012, we estimate FX purchase at NOK80.0bn.
To Read the Entire Report Please Click on the pdf File Below.