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Market update 20 March: Currency markets calmer as central banks spring into action

  • Markets somewhat calmer yesterday.
  • Norges Bank announced several measures yesterday and today to improve market liquidity and the outlook for the Norwegian economy.
  • This morning they cut the policy rate by 75 basis points to a record low 0.25%.
  • Yesterday, for the first time since 1997, Norges Bank intervened in the FX market and actively bought NOK to ease the downward currency pressure.
  • Furthermore, they have offered additional extraordinary NOK F-loans to banks with up to 12 months maturity at favorable terms.
  • Meanwhile, the US Federal Reserve announced the establishment of temporary USD liquidity arrangements (swap lines) with several central banks, including Norges Bank.
  • The Bank of England also announced more measures, including reducing its key policy rate to 0.1% – a record low – and relaunching a GBP 200 billion QE program.

SKAGEN Fund Summary

  • Good communication and cooperation between all funds with portfolio managers working together on cases and sharing insights at a company and industry level.
  • It is important to not focus too much on the noise in the market.

 

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Historical returns are no guarantee for future returns. Future returns will depend, inter alia, on market developments, the fund manager's skill, the fund's risk profile and management fees. The return may become negative as a result of negative price developments.