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Local Norway
03-06-2025
- Business
- Local Norway
What the weakening of the dollar against the krone means for Norway
In January, 1 dollar traded at 11.5 kroner. This week, it was at 10.1 kroner – and currency analysts expect the dollar's weakening to continue. READ MORE: How the latest trade war developments have affected the Norwegian krone A steady decline Norwegian strategists cite several drivers behind the dollar's decline, many of which are tied to US policy under President Donald Trump. Senior Strategist at Sparebank 1 Markets, Dane Cekov, highlighted several key factors: President Trump's tariffs could dampen US economic growth, the effect of expansive tax cuts on public debt, raising concerns among investors, and proposed changes to taxation on foreign investment. "I think more people will question being so exposed to the US," Cekov told the business newspaper e24 . "The combination of these... factors will result in a weaker dollar in the future." Advertisement Long-term prospects Several other Norwegian financial analysts share this view. The dollar is likely to remain under pressure for several years, driven by growing caution among international investors, according to Lars Mouland at Nordea Markets. "The country has large budget deficits and is dependent on a lot of money from the rest of the world," Mouland told the newspaper. Nils Kristian Knudsen of Handelsbanken added that a weaker dollar aligns with Trump's own long-term preferences, though he warned that sharp, fast movements – rather than gradual shifts – could create instability. READ ALSO: What are the US tariffs on Norway, and how could they affect you? What all this means for Norwegian consumers While still strong by historical standards, the dollar could weaken further – possibly reaching 9 kroner in the coming years. But what does this currency shift mean for everyday Norwegian consumers? For most people living in Norway, a weaker dollar typically brings some positive short-term effects. Advertisement Holidays to the United States, online shopping from American websites, and dollar-denominated goods and services become more affordable. If the dollar continues to weaken, as Cekov and other analysts expect, this could also help lower prices on a range of imported goods, such as electronics – though global supply chains and shipping costs also play a role. Bad news for Norwegian exporters On the flip side, a stronger krone relative to the dollar hurts Norwegian exporters. Companies that sell goods or services priced in US dollars, such as in the oil, seafood, and maritime sectors, receive less in kroner for every unit sold abroad. When the dollar's value drops, their earnings – once converted back into Norwegian currency – decline. Advertisement What comes next? While there is a consensus in Norway at the moment that the dollar may weaken further, experts caution that it won't be a straight path. Currency movements are influenced by interest rates, investor sentiment, global economic trends, and political developments. For Norwegian consumers, the bottom line is this: your kroner now go further in dollar markets, but the strength of the krone could also affect jobs and earnings in Norwegian export-heavy industries. READ MORE: What Norway is doing to prepare for the upcoming tariff war
Local Norway
27-05-2025
- Business
- Local Norway
Why Temu orders to Norway look set to become more expensive
Mounting pressure from Norwegian authorities, increasing regulatory scrutiny, and potential new duties on parcel distributors could soon make ordering from Temu more expensive for Norwegian consumers. The shopping platform's appeal lies in its low prices and vast selection, but recent investigations have cast a shadow over its operations. A joint Nordic inspection of products ordered from Temu and similar platforms revealed that 7 out of 10 items contained hazardous substances , including materials banned under Norwegian and EU law. This discovery prompted Norwegian Climate and Environment Minister Andreas Bjelland Eriksen to summon parcel distributors for a high-level meeting on Monday. Their (declared) task? To determine how Norway can better regulate the flow of online imports from platforms like Temu and protect consumers from unsafe goods. READ MORE: Why Norway will hit you with a customs fee for small online purchases from abroad Stricter controls Following the meeting, Minister Eriksen emphasised a collective recognition that "more control is needed," the business newspaper e24 reported. In the short term, the government wants to ramp up customs checks on incoming packages to detect violations of environmental and safety regulations. While this won't cover all 31,000 Temu packages entering Norway daily, the goal is to create a credible threat of enforcement – building the case for distributors to cut ties with non-compliant sellers. Eriksen clarified that the government is prepared to act unilaterally if distributors fail to take responsibility. This could include assigning new legal duties to distributors , such as requiring them to conduct due diligence on platform partners or reject deliveries that don't meet Norwegian standards. Advertisement Why consumers might pay more While consumer protection is the focus of the government's efforts, these additional controls are unlikely to come free – and the cost could land on Norwegian consumers. Distributors such as Posten and Bring are generally not permitted to open individual packages. However, if they're mandated to support customs with expanded control zones, staff training, and technological upgrades to track regulatory compliance, these changes will require significant investment. Similarly, if new legislation places liability or enforcement obligations on these companies, they'll need to develop internal compliance systems – costs that might, at least in part, be passed on through increased service fees or higher delivery charges. For platforms like Temu, additional pressure from Norwegian or European regulations may compel them to alter sourcing practices, submit to external audits, or cut off certain suppliers altogether. That may reduce the availability of ultra-cheap goods, especially those that violate safety standards. And in logistics, time is money - additional inspections and customs holds could delay delivery times, leading distributors to raise prices or prioritise more expensive service tiers. READ ALSO: What are the rules for posting and receiving items in Norway Advertisement A long-term shift on the horizon Another potential source of price inflation is Norway's push for more substantial alignment with EU regulatory frameworks on e-commerce and consumer protection. Both Climate Minister Eriksen and Children and Family Minister Lene Vågslid have voiced support for more integrated European systems that ensure consistent safety data across borders. If they materialise, such systems could lead to the adoption of stricter EU and EEA-wide compliance requirements for non-EEA platforms like Temu. While this would potentially standardise enforcement, it could also increase the regulatory burden on foreign sellers and their logistics partners – raising the costs of doing business in Norway. A price worth paying? This rising tide of accountability may soon make Temu's orders to Norway cost more. And as distributors and platforms absorb these new responsibilities, the end customer will likely see the difference in their final bill. Yet, don't expect consumers to take to the streets - numerous Norwegians might consider it a price worth paying in the broader context of consumer safety.
Local Norway
13-05-2025
- Business
- Local Norway
How the latest trade war developments have affected the Norwegian krone
The news of a 90-day tariff break between the world's two largest economies - the United States and China - briefly boosted the dollar, pushing it up about 10 øre against the krone by mid-morning on Monday. However, the euro's decline and the krone's simultaneous strengthening suggest that Norway's currency may be better positioned than headlines indicate, especially in the broader, long-term view. READ MORE: Analysts predict Norway's krone could make up lost ground on the euro and US dollar Short-term dollar strength, long-term doubts The dollar's initial bounce was largely psychological, according to currency strategist Nils Kristian Knudsen of Handelsbanken. "The dollar has been hit hard by trade tensions, so any form of clarification gives it some relief," Knudsen told the newspaper e24. "But this is not a done deal. The damage to the dollar's credibility is already done." Knudsen argued that the Trump administration has weakened foreign confidence in the dollar by using it as a policy lever in trade disputes , making long-term dollar strength unlikely. "The market has realized that the dollar can be used as a bargaining chip," he added. Advertisement Senior strategist Dane Cekov at Sparebank 1 Markets echoed the sentiment, noting that while some recovery in the dollar is expected, much of the upside has already been priced in. Although we may see short-term gains, I still expect a weaker dollar over the long term, Cekov said. "Uncertainty is lower than before, but it's far from gone." READ ALSO: What are the US tariffs on Norway, and how could they affect you? Euro weakens, but not for long? The euro dipped against the dollar following the trade news, but analysts say the euro still holds ground. "I think the euro will continue to play a stronger role," Knudsen noted, citing consistent structural support from the eurozone and limited future upside for the dollar. This dynamic has worked in favour of the Norwegian krone, which strengthened against the euro during Monday trading. By late afternoon, one euro traded for 11.58 kroner – slightly lower than recent levels. Advertisement Good news for the krone Despite its dip against the dollar, the krone gained strength against a broader basket of currencies, especially in import-weighted indexes like I-44, which measure the krone's performance against Norway's key trading partners. Since the euro holds more weight than the dollar in this context, the krone's gain is seen as positive. It's more important for Norway that the krone strengthens against the euro than the dollar, Cekov said. "The trade truce reduces recession risks, oil prices are rising, and risk sentiment has improved - all favorable for the krone," he explained.
