The USD/DKK currency pair has shown strong trends over the past decade. Between 2006 and the onset of the global financial crisis in 2008 the Danish Krone was appreciating relative to the US dollar. It moved from 6.1671 in January 2006 to 5.8585 to $1 by 2008, but since then it has featured in sharp depreciations over a relatively short timeframe. The support level for the currency pair appears to be just above DKK 4.5 to $1, and the resistance level over the past decade has been DKK6 to $1. The DKK consolidated in a tight trading range between 2010 and early 2015 where it consistently traded around DKK5.6 to the $1. That trend has given way to a sharp depreciation of the DKK as the dollar bulls have run rampant on the financial market since late 2014. This is clearly evident in the 1-year chart for the USD/DKK currency pair featured below.
Key Indicators for the Danish Market
Much like the rest of Europe, the Danish inflation rate has been declining since Q2, 2015. The last recorded inflation rate figure was 0.50% in August 2015. Prior to that, the inflation rate was 0.7% for June and July after inching upwards from 0.6% in May, and 0.5% in April. On 12 October 2015 the next inflation rate announcement will be made and analysts are forecasting 0.88% for the month of September. If this holds true, it will show that prices are increasing, which would be an important factor for the Danish central bank in determining whether to raise interest rates. The inflation CPI data will be released on Monday, 12 October at 3 AM. (UTC -5). As one would expect with declining inflation figures, the consumer price index also decreased between July and August from 131.5 to 131.1. The following upcoming announcements are important indicators of the performance of the Danish economy:
• Friday, 9 October 2015 at 3 AM Balance of Trade – the forecast figure is DKK 6.2 billion
• Monday, 12 October 2015 at 3 AM Inflation Rate Year-on-Year – the forecast figure is 0.88%
• Thursday, 22 October 2015 at 3 AM retail sales month-on-month – a 0.2% increase is forecast for the month of September
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