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CURRENCY

‘Weakest since 1980s’: Norwegian krone hits new low

The Norwegian krone has fallen to its lowest level in three decades.

Published: 5 February 2020 18:07 CET
'Weakest since 1980s': Norwegian krone hits new low
A currency exchange office in Benidorm, Spain last week. Photo: AFP

Norges Bank, the country’s central bank, reports that the krone is at its lowest level since the end of the 1980s when measured against currencies such as the euro, dollar and pound.

On Monday afternoon, the krone was listed at 112.24 points on I44-indeksen, the exchange rate index preferred by Norges Bank.

“This is the weakest level since the late 1980s,” a Magne Østnor, currency strategist with lender DNB Markets, told NRK.

The index measures the strength of the krone against the currency of 44 of Norway's most important trading partners and is a key measure when the central bank sets interest rates.

A record-weak krone has consequences for people who are paid in Norwegian kroner when they travel abroad, as well as on the prices of foreign goods.

Tuesday’s exchange rates showed the krone at 10.20 to the euro. 9.23 to the US dollar and 12.01 to the pound, NRK reported.

READ ALSO: Norway's krone now worth 10 to the euro as value continues to drop

“It’s getting more expensive for Norwegians to go on holiday and buy foreign goods. But it is positive for the Norwegian export industry, which will become more competitive compared to its foreign counterparts as it becomes cheaper to buy Norwegian goods,” Østnor told the broadcaster.

The depreciation of the krone follows a sequence of negative news stories thought to affect investor confidence, after the currency had managed to strengthen in the lead-up to Christmas.

One of the factors that has contributed to the weak krone is the outbreak of new coronavirus in China, according to Østnor.

“The exchange value of the krone has depreciated over several years, but there is no doubt that the coronavirus has been a trigger. But the blame must also be shared with figures from the Norwegian economy which show that growth at home is slowing, the analyst told NRK.

“We must get used to the fact that the krone will remain at this level in future. The krone is at a record low looking backwards but fits well with the situation in the Norwegian economy at the moment,” he added.

READ ALSO: Why Norway's krone could keep losing value

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CURRENCY

Spanish town brings back the peseta in bid to boost spending

They haven't been legal currency in Spain since 2002 but residents in one town in Valencia can now spend any old pesetas they have hidden away thanks to a scheme aimed at boosting spending during the coronavirus crisis.

Published: 28 October 2020 14:12 CET
Spanish town brings back the peseta in bid to boost spending
Old peseta notes and coins can be exchanged until the end of 2020. Photo: AFP

The Multipaterna Commerce and Services Association has launched a campaign that allows payment to be made with pesetas in certain establishments in Paterna, a town in the Valencian Community.

The campaign, which includes hardware stores, opticians, computer and electronics stores, real estate, florists, lingerie stores and parcel kiosks, will run until December 15th. 

For the rest of Spain those who still have the old currency there is still a few months left to convert them into euros, although they can’t spend them in shops.

Spaniards have been told that they have until December 31st 2020  to exchange their pesetas for euros and that applies for both bank notes and coins.

Any notes produced during the Franco era, which ran from the end of the Civil War in 1939 until the dictator's death in 1975 can be automatically changed by the Bank of Spain.

Those issued during the conflict can also be exchanged but the process will involve them being analysed by experts to confirm their authenticity.

And any coins still in circulation at the time that euros were brought in on New Year's Day in 2002 can also be exchanged at Bank of Spain headquarters in Madrid.

The exchange rate offered  by the Bank of Spain is 1 euro = 166,386 pesetas but the bank advised that commemorative coins and notes may be worth more as collectors' items than for their face value, which is all that will be offered in the exchange scheme.

The Bank of Spain estimates that pesetas worth some €1.61 billion are squirreled away in Spanish homes, cluttering up the drawers of old desks and trunks in dusty old attics.

Many will never see the light of the day and others have become collectors' items now worth more than their exchangeable value.

Spain adopted the Euro at the start of 2002 but pesetas were still legal currency during a transition period that lasted the first three months of that year.

Exchanges can be made in person at the Banco España building on Madrid's Calle Alcala or via a postal or online service, even available to those abroad.  For more information check out the official webpage of the Banco España HERE. 

By Conor Patrick Faulkner in Valencia

 

 

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