In September 2012, Norway's central bank said it would delay plans to tighten monetary policy. When the Norges Bank does pursue tighter monetary policy, the Norwegian krone is likely to rise against foreign currencies.

Question

Quizplus · Accepted Answer

When a central bank tightens monetary policy, it generally leads to a stronger currency as it signals a more attractive investment environment and may result in higher interest rates. Therefore, if the Norges Bank were to pursue tighter monetary policy in the future, the Norwegian krone would likely appreciate against foreign currencies.

In September 2012, Norway's Central Bank Said It Would Delay