Morning Report

20.04.2012

Weak US data
NOK & 3m NIBOR 7.70 2.80 7.60 2.60 7.50 2.40 7.40 2.20 7.30 12-Mar 30-Mar 19-Apr
3m ra. EURNOK

Yesterday's result of the Spanish government debt auction was better than many had feared. U.S. figures came in on the weak side of expectations. The changes in the foreign exchange market, however, have been small relative to yesterday morning, although the movements during the day were volatile. The Spanish Treasury sold 2,5 billion euro in 2- and 10-years bonds. The auction saw good demand, and even though the interest rates on the new loans are higher compared to similar previous auctions, they where slightly lower than the going rate at the moment of the auctions. Initial claims to unemployment benefits fell by 2 'to 386' people. Last week's numbers were, however revised higher. The 4-week average rose, and supports last month's non-farm payrolls, indicating that the improvement in the labor market in the U.S. is slowing down.

SEK & 3m STIBOR 9.0 8.9 8.8 2.40 2.20

8.7 2.00 12-Mar 30-Mar 19-Apr

3m ra. EURSEK

The Philadelphia Fed index for the current situation fell unexpectedly from 12.5in March to 8.5 in April. Even though the index still indicates growth, the level is lower than the long-term average. The bright spot is that the index of employment rose significantly, and that the economic outlook still is perceived as good. Philly Fed confirms the impression from the Empire State index earlier this week of a slightly lower growth rate in the industry. Existing home sales in the U.S. in March was also slightly weaker than expected. 4.48 million homes were sold in March, 2.6 percent fewer than in February. The figures confirm the impression that even though the housing market probably has reached the bottom, it is still weak. While the ZEW index earlier this week indicated continued improvement in the German economy, consumer confidence in the euro area as a whole indicate a weak trend in consumption in the future. The index fell from -19.0 in March to -19.8 in April, and is now lower than the long-term average. Changes in the foreign exchange market since yesterday morning have been small. However, intra-day movements where volatile. While the results from the Spanish debt auction and weaker than expected U.S. figures contributed to a strengthening of the euro, rumors of a French sovereign downgrade helped weaken the euro. These rumors were later disproved. Japanese yen has since the beginning of the week depreciated on rumors that the Bank of Japan will announce additional quantitative easing next week. Although the outcome of the Spanish auction was considered good, both Spanish and Italian interest rates increased yesterday. The Italian government announced Wednesday that the budget deficit in 2013 will be larger than previously thought. The Norwegian krone strengthened somewhat through the day yesterday, but was traded within a relatively narrow range. Despite good corporate results in the United States, U.S. stock markets fell due to weaker than expected economic data. In Europe, the banking sector weighed stock markets down. Uncertainty about the consequences of the French presidential election and rumors of a French downgrade contributed to the French banks falling by about 5 percent yesterday. On the agenda today is the German IFO index. Expectations are it will confirm the impression from the ZEW index on Tuesday of higher activity in the German economy. It is expected that the UK retail sales figures shows a growth of 0.5 percent from February to March, after a fall of 0.8 per cent the previous month. Spring sessions begins today at the IMF and the World Bank, and continues through the weekend. Press releases and statements will come under scrutiny in search of comments about the situation in Europe. IMF head, Lagarde, will hold a press conference Saturday evening. Sunday sees the first round of the French presidential election. A final result will probably have to wait until the second round elections held 6 May, but opinion polls suggest that President Sarkozy can be replaced by socialist Hollande.

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Yesterdays key economic events (GMT) 12:30 USA Initial claims 14:00 USA Philadelphia Fed 14:00 EMU Consumer confidence Todays key economic events (GMT) 08:00 Germany IFO 08:30 UK Retail sales Global IMF/World Bank meetings

As of week 15 Apr Apr As of Apr Mar

Unit 1000 index index Unit index m/m %

Prior 380 12.5 -19.0 Prior 109.8 -0.8

Poll 370 12.0 Poll 109.5 0.5

Actual 386 8.5 -19.8 DNB

Morning Report
20.04.2012

SPOT RATES AND FORECASTS

Oil spot & NOK TWI 135 125 115 105 12-Mar 30-Mar
NOK TWI ra.

96 94 92 90 19-Apr
$/b

EUR vs GBP & CHF 1.22 0.85 1.21 1.21 0.84 0.83

1.20 0.82 12-Mar 30-Mar 19-Apr

GBP r.a CHF

FX USDJPY EURUSD EURGBP EURCHF EURNOK EURSEK EURDKK USDNOK JPYNOK SEKNOK GBPNOK USDSEK JPYSEK NOKSEK GBPSEK

Prior 81.67 1.314 0.818 1.202 7.547 8.847 7.439 5.746 7.040 0.855 9.222 6.745 8.255 1.173 10.815

Last 81.55 1.314 0.819 1.202 7.550 8.858 7.439 5.752 7.046 0.853 9.223 6.743 8.272 1.174 10.827

% -0.1% 0.0% 0.0% 0.0% 0.0% 0.1% 0.0% 0.1% 0.1% -0.1% 0.0% 0.0% 0.2% 0.1% 0.1%

In 1 m ...3 m 83 84 1.30 1.30 0.83 0.83 1.20 1.20 7.60 7.50 8.90 9.00 7.45 7.45 5.85 5.77 7.04 6.87 0.85 0.83 9.2 9.0 6.85 6.92 5.68 5.82 1.17 1.20 10.72 10.84

...6 m ...12 m 85 85 1.35 1.40 0.85 0.87 1.20 1.30 7.50 7.60 9.00 9.00 7.45 7.45 5.56 5.43 6.54 6.39 0.83 0.84 8.8 8.7 6.67 6.43 5.67 5.46 1.20 1.18 10.59 10.34

FX AUD CAD CHF CZK DKK GBP HKD ISK KWD LTL LVL NZD PLN SGD RUB

USD 1.0332 0.9950 0.9148 18.92 5.6622 1.6059 7.7619 127.05 0.2787 2.6285 0.5328 0.8140 3.1921 1.2517 29.5200

% -0.05% -0.11% -0.07% -0.05% -0.02% 0.02% -0.01% -0.02% -0.11% -0.02% -0.02% -0.11% -0.03% 0.01% 0.01%

EURSEK & OMXS 550 500 8.9 450 8.8 400 8.7 350 12-Mar 30-Mar 19-Apr 9.0
OMXS ra. EURSEK

1m 3m 6m 12m 3y 5y 7y 10y

NIBOR Prior 1.94 2.31 2.66 2.88 2.95 3.15 3.34 3.57

SWAP AND MONEYMARKET RATES STIBOR EURIBOR Last Prior Last Prior 1.96 1.92 1.92 0.36 2.32 2.18 2.18 0.65 2.69 2.43 2.43 0.98 2.92 2.54 2.54 1.16 2.95 2.08 2.08 1.15 3.15 2.22 2.22 1.51 3.34 2.38 2.38 1.86 3.57 2.52 2.52 2.22

Last 0.36 0.65 0.98 1.15 1.15 1.51 1.86 2.22

USD LIBOR Prior Last 0.24 0.24 0.47 0.47 0.73 0.73 0.89 0.89 0.69 0.70 1.14 1.14 1.60 1.60 2.08 2.08

Gov. Bonds, 10y 2.25 2.00 1.75 3.00 2.50 2.00

1.50 1.50 12-Mar 30-Mar 19-Apr

NOK, ra. SEK

10y 10y yield vs bund

NORWAY Prior Last 115.85 112.30 2.24 2.24 0.53 0.54

GOVERNMENT BONDS SWEDEN GERMANY US Prior Last Prior Last Prior 115.563 115.57 100.475 100.47 100.28125 1.80 1.80 1.71 1.70 1.97 0.09 0.10 0.26

Last 100.31 1.97 0.28

JPY and DowJones 85 13.5 13.0 80 12.5 75 12.0 12-Mar 30-Mar 19-Apr
USDJPY ra. DowJones, 1000

In 3m 6m 12m

INTEREST RATE FORECASTS NORWAY SWEDEN GERMANY 3m nibor 10y swap 3m stibor 10y swap 3m euribor 10y swap 2.40 3.50 2.15 2.75 0.80 2.50 2.45 3.75 2.10 2.75 0.80 2.75 2.70 4.25 2.00 3.00 0.80 3.25
% - 0.02 - 0.03 Last 117.4 118.0 1650.0

US 3m libor 10y swap 0.50 2.50 0.50 2.50 0.50 3.00

% -0.5% -0.8% 0.0% -1.9% -0.9% 0.0% -0.2% 0.5% 0.6%

USD and gold 1900 1.42 1800 1.38 1700 1.34 1600 1.30 1500 1.26 12-Mar 30-Mar 19-Apr
EURUSD ra. Gold

MISCELLANEOUS FRA NOK 3m Prior chg TWI Today JUN 2.26 2.26 0.00 NOK 94.44 SEP 2.27 2.27 0.00 SEK 117.28 DEC 2.34 2.34 0.00 EUR 103.36 MAR 2.43 2.43 0.00 USD 79.53 FRA SEK 3m Prior chg GBP 82.90 JUN 2.13 2.13 0.00 Comm. Today SEP 1.96 1.96 0.00 Brent spot 117.4 DEC 1.93 1.93 0.00 Brent 1m 118.3 MAR 1.93 1.93 0.00 Spot gold 0.0 Sources to all tables and graphics: Reuters and DNB Markets

Stock ex. Today Dow Jones 12,964.1 Nasdaq 3,007.6 FTSE100 5,744.6 Eurostoxx50 2,284.7 Dax 6,671.2 Nikkei225 9,551.8 Oslo 420.50 Stockholm 489.20 Copenhagen 606.97

Morning Report
20.04.2012
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