Norway's poor regional growth survey raises risk of earlier rate cut

The oil sell-off and future growth outlook highlighted in Norges Bank's regional network survey weakened NOK and rose the risk of an earlier cut, notwithstanding ECB's meeting, 

There is a considerable fall in oil output as reported by the oil service sector, the speed of which accelerated since August and somewhat been more than expected. As suggested by the survey, the future output is likely to continue its sharp decline further.

Norges Bank's December move seems underpriced in the context of last week ECB's easing, and there are upside risks seen to EUR/NOK moving towards the meeting.

"This week, we forecast CPI-ATE to have been flat on the month, growing 3% y/y, in line with consensus expectations. Moreover, a disappointing print in Monday's IP data could provide the impetus for an earlier Norges rate cut", says Barclays in a research note.