Newsletter · 2026-09-26 · Ashutosh Agarwal

Norway Hikes and Australia Is Next as Exporters Fight the Dollar - Commodity FX: AUD, CAD, NOK & NZD - Week of September 26, 2026

Commodity FX and rates newsletter for the week of September 26, 2026. Norway surprised with a hike and Australia is expected to follow, so the exporter currencies now out-yield the US dollar for the first time in a decade, even as a rising dollar and a global diesel squeeze pull the other way.

Commodity FX: AUD, CAD, NOK & NZD

Week of September 26, 2026: Norway Hikes and Australia Is Next as Exporters Fight the Dollar

Last Saturday we wrote that Norway's central bank would sit on its hands. On Thursday it raised rates anyway.

That surprise tells you most of what you need to know about this week. The Federal Reserve's hike the week before didn't isolate America. It gave everyone else permission. Norway went on Thursday. Sweden all but promised to go before Christmas. Canada's central bank governor spent the week hinting. And on Tuesday, Australia's Reserve Bank is expected to raise rates for the fourth time this year.

So the commodity-currency club is suddenly doing something it hasn't done in a decade: paying investors more than the US dollar does. On paper, that's a big tailwind. The catch is that the dollar keeps winning anyway. As J.P. Morgan's FX team put it on Friday, "the dollar's finally breaking higher."

This week's story is a tug-of-war. Higher interest rates at home pull the exporter currencies up. A stronger dollar pulls them back down.

TL;DR

Norway hiked to 4.5% and says rates stay high through 2027. Economists were split almost exactly down the middle (11 called a hike, 10 a hold, J.P. Morgan among the holds). J.P. Morgan now calls the krone "a high-yielder within G10" going through "a structural shift," and says it is "leaning even more into" its bullish view.
Sweden held but promised hikes "this year," probably more than one. Markets price roughly an 80% chance of a November move. J.P. Morgan still sees the krona as a "funder," meaning a cheap currency people borrow in, not one they buy.
Australia is next: a hike to 4.6% on Tuesday is close to a done deal. Nomura puts the odds at 70-75%, MUFG says the market prices about 90%. The reason is diesel. Australia is "the world's largest per capita importer of diesel," says Bloomberg Economics, and truckers are finally passing the cost on.
Australia's inflation figure lands Wednesday, and it's expected to be ugly. Nomura sees headline CPI jumping to 4.2% from 3.5%, with fuel alone adding about half a percentage point.
Canada's governor hinted, and the loonie didn't care. Tiff Macklem signalled higher rates. Markets price about 50 basis points (half a percentage point) of hikes by January. The Canadian dollar showed "no reaction whatsoever," says IceCap's Keith Dicker, because the US dollar is "ripping."
Oil blinked, diesel didn't. Brent slid six sessions in a row and dipped below $100, before an Iranian ultimatum pushed it back up. Diesel, meanwhile, hit an all-time high above $200 a barrel, per Morgan Stanley.
Trump and Xi agreed to extend the trade truce into January, and not much else. Commentators called it "managed brinkmanship" and "so little substance."
Copper is back near record highs, but Bloomberg Intelligence warns it could drop $1,500-2,000 a ton if Washington rules out copper tariffs.

What's new

Norway breaks ranks, and J.P. Morgan leans in

The call that caught people out. On J.P. Morgan's At Any Rate: "Global Rates... the recent Riksbank and Norges Bank meetings" (Sep 25), rates strategist Kegendra Gupta laid out how close it was. The Bloomberg survey had 11 economists calling a quarter-point hike and 10 calling a hold, J.P. Morgan among them. Norges Bank hiked to 4.5%. That cancels out the two cuts it made during 2024-25.

The bigger news was the guidance. Norway's central bank used to say it would reverse this year's hikes by the end of 2026. Now it plans to keep rates high "at least over the course of 2027." Why? It now thinks the "neutral" rate is higher than it used to believe. (The neutral rate is the interest rate that neither speeds up nor slows down the economy.) Gupta expects one more hike and isn't ruling out 5%. (Insider: a bank's own rates desk.)

Why that matters for the krone. On the same bank's currency podcast, At Any Rate: "Global FX: US diesel ban, dollar view, G10 central banks" (Sep 25), FX strategist Octavia Popescu noted that the krone "struggled to benefit on the day." Markets had already priced a second hike, and some of that came out. But she thinks what matters is the message: rates stay "higher for longer," with another hike still possible.

"We maintain that [the krone] is undergoing a structural shift being a high-yielder within G10 now. And Norges Bank very much validated this existing constructive view, and we are leaning even more into it now."

Octavia Popescu, J.P. Morgan

Her reasoning: Norway's interest-rate advantage over other rich countries is "at historical highs." In a nervous market, that extra income is enough to support the currency. (Insider.)

Sweden: hawkish words, still a borrowing currency. The Riksbank held, but said that if the outlook holds, "increases to the policy rate will begin this year," and more than one. Gupta noted the market is already ahead of the bank. Traders price about an 80% chance of a November hike and roughly 1.25 percentage points of hikes by the end of next year. That matches the Riksbank's own hawkish scenario, where rates go to 3% and stay there. J.P. Morgan expects three hikes.

Popescu's point is that none of this changes Sweden's role in currency markets. The krona "still very much remains a funder." A funder is a low-interest currency that investors borrow in so they can buy higher-yielding ones. That's the carry trade: you pocket the gap between the two interest rates. Rising global and US yields should keep pressure on the krona, she says. (Insider.)

On Saxo Market Call: "This is nuts - when's the intervention?" (Sep 24), Saxo's host called the krona's reaction a "polite appreciation." He also flagged the one mix the krona hates: a general risk-off move plus rising European bond yields. He noted the Norway vote "wasn't unanimous by any means," and that Sweden's bank still talks about "spare capacity in the economy," so "it doesn't look exactly like an emergency." (Pundit: a market commentator.)

Norway's oil fund might become a big bond buyer. A side story with real money attached, from Baird's Convexity Pulse (Sep 21). Norges Bank has recommended adding US agency mortgage bonds to the benchmark of the roughly $2 trillion sovereign wealth fund, at 12.8% of its bond portfolio. Baird's Stephen Shearer put that at about $77 billion. Spread over a year, that's $4-6 billion a month, roughly 15% of new mortgage-bond supply. It isn't approved yet. (Insider: a bond desk.)

Australia: diesel is doing the RBA's job for it

The case for a hike most people didn't expect in the summer. The most interesting conversation of the week was on Bloomberg Daybreak Weekend: "US Jobs, Burnham Conference, RBA Decision" (Sep 25). Bloomberg Economics' Australia and New Zealand economist James McIntyre opened with: "I've changed my view."

For months he'd thought some of this year's three hikes (rates are now 4.35%) might even have been "a policy mistake." What changed his mind was diesel. Australia is "the world's largest per capita importer of diesel." About 80-85% of freight inside the country moves by road, on diesel. The RBA's business contacts are telling it that trucking companies have hit the point where they "have to finally begin to pass it through." That's with demand weak, and heading into the November-December shopping season.

His numbers: fuel alone should add about 0.7 percentage points to inflation in a single month in the August data, and "a little bit worse still" in September. Governor Michelle Bullock has said unemployment of 4.5-5% is probably needed to cool the job market. So the RBA is choosing to "set aside the labour market" to head off a new inflation scare. (Insider: a bank-side economist.)

The cost lands on housing. McIntyre's bleakest detail: house prices are now falling in the smaller state capitals that had held up, not just Sydney and Melbourne. With prices down and building costs rising, it's "an incredibly difficult economic pinch point" for developers. He expects housing and consumer spending to weaken "through the remainder of 2026 and into 2027." The one bright spot: Australia's own AI and data-centre boom, which he says could top 2% of GDP next year, largely because hyperscalers want to tap cheap Australian solar and wind.

How sure are the pros? On Nomura's The Week Ahead: "Still looking cloudy from the summit" (Sep 25), Nomura's Australia economist and co-host Andrew went for a hike to 4.6% with 70-75% confidence, calling it "not a no-brainer." The case against: unemployment is creeping up and house prices are falling, "not normally the environment in which you'd expect to see a rate hike." The case for:

July monthly inflation came in on the high side
Growth of 2.1% beat the RBA's 1.9% forecast
Productivity growth was zero, and labour costs per unit of output are high
Oil is high, with early signs of it feeding into other prices
Other central banks are hiking ("all central bankers talk to one another")

His base case is "one and done." He thinks Wednesday's inflation report matters more than Tuesday's guidance. He expects headline inflation at 4.2%, up from 3.5%, partly because a fuel tax subsidy ended in August. He'll also be watching minimum-wage increases feeding into services, and early price rises in appliances, phones and laptops. (Insider.)

What it does to the Aussie dollar. On The MUFG Global Markets Podcast: "Fixed Income contagion risks" (Sep 25), an MUFG FX strategist said a hike is "90% priced." He called Bullock's speech last Friday "fairly hawkish" and thinks she may keep the door open to another move. That "should be fairly supportive for Aussie." Then comes the warning: if bond-market turmoil forces investors to unwind carry trades, "Aussie will certainly suffer." (Insider.)

J.P. Morgan's Neeraj Chandan, co-head of FX strategy, put it in a bigger frame. The Australian dollar and the krone are "yielding above the dollar for the first time in a decade," which makes them "worth having a look at... despite the degree of outperformance we've seen already" (At Any Rate, Sep 25). (Insider.)

A labour-market footnote. On NAB Morning Call: "PMIs push bond yields higher, AUD a victim" (Sep 23), NAB's strategist pointed out that the previous jobless rate was 4.46% before rounding, so it was "on a knife edge." He also noted that Bullock has suggested unemployment "may need to rise to at least 5%" before demand cools enough. The episode's title says what happened to the Aussie that day: strong US business surveys pushed the US five-year Treasury yield above 5% for the first time since 2007, and the Aussie was "a victim." (Insider.)

Canada: the hint that moved nothing

Macklem nudges, the loonie shrugs. On The Loonie Hour: "McDonald's CEO: Food Inflation Is Here to Stay" (Sep 25), Keith Dicker of IceCap Asset Management recapped Tiff Macklem's visit to Halifax. The Bank of Canada governor effectively told Canadians rates are probably going up: "He's giving you the nudge on it." Last week the show argued that global hikes would give the Bank of Canada cover. This week that played out.

What Dicker found most telling was the currency:

"Right away, I said, oh, what's happening with CAD, with Canadian dollar? Nothing. There was no reaction on the currency side whatsoever. Because the US dollar has been really strong over the last four or five days. It's just ripping along."

Keith Dicker, IceCap Asset Management

Host Steve Saretsky read out market pricing. A one-month forward contract implied about a 65% chance of hikes, with rates about 50 basis points higher by January. That works out to "five rate hikes over the next 12 months," a path he openly thinks is "going to be wrong." A mortgage-broker friend of the show is already seeing "huge jumps" in mortgage rates. Saretsky explained why: banks have been slow to pass on their own higher funding costs, and that gap is now closing. (Dicker: insider, an asset manager. Saretsky and Diaz: pundits.)

A side note from the same episode: Canada's population grew just 0.5% over the past year, the slowest since 1915, even after an upward revision. Co-host Richard Diaz pointed out that Canada is still about 2.1 million people above its trend. He also noted that the strong second-quarter GDP figure partly reflects "more warm bodies," not better productivity.

Washington's version of the trade fight. On Bloomberg Talks with US Trade Representative Jamieson Greer (Sep 21), the most useful detail for commodity watchers was what Greer said hasn't changed. US measures cover about 5% of Canadian goods, "about 0.06% of US consumption." And "there's a lot of oil and gas and critical minerals and ag trade. We've never disturbed that." He says the US offered to halve steel and aluminum tariffs, cut auto tariffs and remove some lumber tariffs, and that Canada agreed, then walked away days later. On Canada's courtship of Europe: "zero growth plus zero growth still equals zero growth." His stated priority for the upcoming USMCA renegotiation is stopping China or Vietnam from routing goods through Canada or Mexico. He contrasted Canada with Mexico, which he called "quite pragmatic." (Insider: a sitting official, with an obvious negotiating agenda.)

Where the damage actually shows. On Automotive News Daily Drive (Sep 22), J.D. Power data showed US-built vehicles' share of Canadian sales falling from about 40% to 28.4% in the first half of 2026. Mexico is at 22.2% and could overtake the US as Canada's top vehicle source next year, because Mexican-built cars still enter Canada tariff-free under USMCA. That makes Mexico the quiet winner of the Canada-US fight. (Insider: industry reporting.)

The oil lifeline both sides lean on. On the Energy News Beat Podcast (Sep 25), Midland oilman Kirk Edwards of Latigo Petroleum reminded listeners that the US imports about 4 million barrels a day from Canada. About 650,000 barrels a day now reaches the coast through the Trans Mountain pipeline, and Midwest refineries need Canada's heavy, sulphur-rich crude to make diesel. Canada, he said, "literally could take it off the market for a month" and "sink our economy." (Insider: an oil producer.)

Oil blinked, diesel didn't

Crude had its worst run in a year. On Morning Call (Sep 23), the host noted WTI briefly fell below $90 and Brent below $100, a six-session losing streak and the longest since August last year. The triggers: the first US-Iran talks since June, and reports that Saudi Arabia's damaged East-West pipeline was restarting. By Thursday, per Saxo, a fresh Iranian one-week ultimatum had crude "back on the bid."

The professionals aren't buying the dip in fear. On Squawk on the Street (Sep 22), Francisco Blanch, head of commodities research at Bank of America, said he'd just raised his fourth-quarter Brent forecast to around $100. His reasons:

Middle East exports are running at 7-12 million barrels a day, against about 20 before the war
Global inventories, the buffer that has protected the economy so far, are running down
China, "the one country that built inventories for years," drew its stockpiles down about 10% over six months, and "now they're starting to come back into the market"

If diplomacy wins, he sees a surplus in 2027. He just doesn't think that's likely yet. (Insider.)

Canadian energy view. On BNN's Market Call with John Stephenson of Granite Point Research (Sep 21), Stephenson expects oil to stay "in and around $100 a barrel for the foreseeable future." He pointed to a split between paper and physical markets: futures at $93-94, but "$150 for landed cargo in Singapore." Natural gas is the opposite story. Storage is above average and a "super El Niño" winter is coming. Canada's AECO gas price sits around $1, against about $27 for Europe's benchmark. He likes Peyto (a buy) for a Centrica deal that links 50,000 mcf a day to European prices from 2029. On oil-heavy Whitecap, he'd "sell half" after its run and keep the rest. (Insider: a sector analyst.)

Diesel is the real shortage. Morgan Stanley's head of commodity research Martijn Rats, on Thoughts on the Market: "The Global Diesel Problem" (Sep 24), explained why in plain numbers. About 4-5 million barrels a day of refining capacity is offline, half in the Middle East and half in Russia after Ukrainian drone strikes. That removes about 1.5 million barrels a day of diesel from a global seaborne market of only about 8 million. Diesel just hit an all-time nominal high "over $200 per barrel." The crack spread, the extra you pay for diesel over the crude it's made from, is about $100. That's against about $20 in normal times and a peak of $60-70 in the 2022 crisis. (Insider.)

The self-styled "Doomberg," on The HC Commodities Podcast (Sep 22), put it more bluntly: the gap between calm crude and exploding diesel "tells you that the real shortage is at the refinery node, not at the crude node." (Pundit.)

The export-ban wildcard. Washington is openly debating a ban on US diesel exports before the midterms. On Columbia Energy Exchange (Sep 25), Piper Sandler's Jan Stuart estimated a ban would leave about 1.5 million barrels of diesel with nowhere to go. Refiners would have to cut output, which worsens gasoline imports. It might knock US pump diesel from about $6.50 to around $4.50 for a while. He also blamed about 25% of "the silliness in diesel prices" on tanker rates. Energy analyst Paul Sankey (Morning Call) called a ban "a terrible idea" and put the cost of shipping oil from Saudi Arabia to China at about $25 a barrel, up from under $2 before the war. (Both insiders.)

For currencies, J.P. Morgan's Chandan ranked who a ban would hurt most. In the rich world: the UK, then the euro area. Globally: Latin America, with Chile, Peru, Mexico, Colombia and Brazil standing out. The desk's own commodity strategists think the US would be oversupplied within a month of a ban, which could force a quick rethink (At Any Rate, Sep 25). (Insider.)

The dollar: finally doing what the models said

J.P. Morgan's FX desk has been bullish on the dollar for weeks. This week, Chandan said, "the dollar's finally breaking higher." He still called the actual moves "underwhelming" given everything that's happened. His colleague Patrick Locke laid out the reasons to stay bullish: "all systems firing on the inflation side" in the US, "a little bit more daylight" between US and global growth, and a late-September seasonal pattern that "screens positive." The next test is Friday's payrolls, where the consensus is 100,000 jobs. The desk's framing is useful: markets rotate between a "dollar leg" and a "carry leg," and "we're in the midst of the dollar leg right now" (At Any Rate, Sep 25). (Insider.)

A longer view came from fixed-income portfolio manager Henry Peabody on Monetary Matters: "Why the Fed May Have to Hike Far Higher Than Expected" (Sep 24). He expects "dollar weakness" in the out-years. Near term, though, he sees a risk of the dollar spiking as traders who bet against it scramble to buy back (reshoring, and Fed Chair Warsh shrinking the balance sheet). He had one interesting tell: "The Fed and the monetary authorities and the fiscal authorities do not want a dollar substantially stronger than here." And: "I would not want to be a currency trader today. Not whatsoever." (Insider.)

The carry trade looks almost too comfortable

On State Street's Street Signals: "There's Something About Carry" (Sep 24), the host went through the positioning data. Hedge funds are net long the Australian dollar and the Mexican peso, with the peso position "pretty large relative to history." Overall, he said, positioning isn't extreme. What bothers him is that the high-yielding currencies are barely moving together anymore. Their average correlation is near a 20-year low. That's what he watches for before trouble:

"It's kind of hard to imagine conditions getting better for carry in the coming weeks than they already are. Rates, after all, are rising pretty much everywhere, and market historians will know that rising rates can often come with unforeseen and uncomfortable consequences down the line."

(Insider: a custody bank's strategy team.)

The debate

This week's podcasts gave both sides real ammunition. That's a change from recent weeks, when the bear case mostly argued itself.

The bull case: the club finally pays you to hold it. For the first time in a decade, Australia and Norway yield more than the US (J.P. Morgan, Sep 25). Norway has told the world rates stay high through 2027 (J.P. Morgan rates, Sep 25). Australia is about to hike, and a hot inflation report could keep the door open for November (Bloomberg, Sep 25; MUFG, Sep 25). On the commodity side, Bank of America sees Brent around $100 into year-end, with China "starting to come back into the market" (Squawk on the Street, Sep 22). If you want income and a commodity cushion, the krone and the Aussie are the cleanest candidates in years.

The bear case: higher rates at home are losing to a rising dollar and a nervous bond market. Canada's governor all but signalled a hike, and the loonie didn't move, because the US dollar was "ripping" (The Loonie Hour, Sep 25). US five-year yields went above 5% for the first time since 2007, and the Aussie was a "victim" (NAB, Sep 23). Carry trades look crowded in the quiet way that tends to end badly (Street Signals, Sep 24). If they unwind, "Aussie will certainly suffer" (MUFG).

There's also a deeper problem with Australia's hike. It's a response to an energy cost, not a booming economy. Unemployment is rising, house prices are falling, and the RBA is choosing to "set aside the labour market" (Bloomberg). Rates that rise because of a supply shock are less supportive of a currency than rates that rise on strength.

Where it nets out. The split this letter has tracked all summer is sharper than ever, and it now runs through central banks as well as oil. Norway exports energy, its central bank is hiking into strength, and its currency is a new favourite of the big banks. Australia imports diesel and is hiking into weakness. Canada sells the barrel but can't get its currency off the floor against the dollar. Sweden is still where you borrow. Same club, four very different stories.

Trades in play

The desks got specific this week. These are the views as stated on the podcasts, not recommendations from us:

Long the krone as a new high-yielder. J.P. Morgan maintains its "constructive stance" on the krone and is "leaning even more into it" after the hike (At Any Rate FX, Sep 25).
Borrow in krona and Swiss francs, not yen. The same desk calls the krona and the Swiss franc "funders," and describes "a rotation in the funders" away from the yen, where Japan keeps threatening to intervene.
Respect the dollar for now. J.P. Morgan: "certainly still constructive on the dollar right here, right now," with payrolls on Friday as the next test.
Australian dollar into a hike, with a carry-unwind hedge in mind. MUFG sees the hike as "fairly supportive for Aussie" but flags carry liquidation as the main risk (MUFG, Sep 25). J.P. Morgan says the Aussie is "worth having a look at" despite its run.
Canadian gas over oil, selectively. Granite Point's Stephenson rates Peyto a buy for its European-linked gas deal, and suggests taking half off Whitecap after its run (Market Call, Sep 21).

The biggest risk to all of it is still the Strait of Hormuz. A real US-Iran deal would take the air out of oil, diesel and Australia's inflation problem in one go. And by McIntyre's reckoning, it could let the RBA stop after one hike.

Read-throughs

Norway / Equinor: Norges Bank at 4.5% and holding high through 2027, with the krone framed as a structural high-yielder (J.P. Morgan rates; J.P. Morgan FX). For an energy exporter, $100 oil and $200 diesel are close to a pure positive. The oil fund's possible $77 billion move into US mortgage bonds is a reminder of how much firepower sits behind the krone (Baird).
Swedish housing / banks: A Riksbank that promises hikes "this year," with markets pricing about 1.25 points of increases by end-2027 (J.P. Morgan rates), points to rising mortgage costs for Swedish households. The Saxo host added that the krona dislikes rising European yields in a risk-off market (Saxo).
WTI / Brent + Canadian energy (CNQ, SU, ENB): Crude dipped below $100 before bouncing, and BofA and Granite Point both see about $100 holding (Squawk; Market Call). Greer says oil and gas trade with Canada has "never" been disturbed (Bloomberg Talks). Kirk Edwards notes Midwest refiners depend on Canadian heavy crude, much of it moving on Enbridge's system (Energy News Beat). Canadian gas is the weak spot, with AECO near $1.
Diesel / refined products: The sharpest edge of the energy shock, and the direct cause of Australia's hike. Over $200 a barrel, with a crack spread of about $100 (Morgan Stanley). BofA thinks US diesel could reach "$200 plus a barrel for a bit of time," because "we're going to winter with no stocks."
Copper: Back near records. Comex touched $6.84 a pound, and China's Yangshan import premium hit $124 a ton, the highest in nearly four years (Northern Miner). But Bloomberg Intelligence's Grant Sporre is "tactically cautious." Outside the US there is "plenty of copper around," and a US decision against copper tariffs could knock $1,500-2,000 off the price. The KE Report's Darrell Fletcher is more upbeat: copper is up 11 of the past 12 weeks and Chinese demand is "starting to pick back up" (KE Report, Sep 22).
Iron ore + BHP / RIO / Fortescue: Quiet on price, at $97.51 a ton and flat on the week (Northern Miner). The structural story came from Money of Mine (Sep 19). China's state buyer, China Mineral Resources Group, now negotiates for more than half of China's 1.2-billion-ton annual imports. And Rio Tinto and Fortescue have both switched pricing indices in the past six months, with one index reportedly cheaper than Platts on 28 of 32 days measured. Pricing power is quietly shifting toward Beijing. (Pundit: a mining podcast's history episode.)
The China growth cue / yuan: The Trump-Xi summit extended the tariff truce two months into January (The Exchange, Sep 24). Nomura's Jing Wang expects China's September factory survey to tick up to about 50, but sees domestic demand "on the weak side" and a likely October pullback (Nomura). The oil angle cuts both ways. BofA sees China restocking. Independent researcher Jérémie Boyer of Aurelion argues China "just continue[s] to import much less oil," and is bearish crude for that reason (Monetary Matters, Sep 20). (Boyer: pundit/independent research.)
The Mexican peso (USMCA peer): Under pressure this week, per MUFG, and one of State Street's most crowded carry longs. It's also among the currencies J.P. Morgan sees as most exposed to a US diesel ban. Mexico's foreign secretary Roberto Velasco Alvarez is "cautiously optimistic" on a US deal, with car and steel tariffs the main sticking points (Bloomberg Talks, Sep 25). The structural win: Mexico is overtaking the US as Canada's car supplier (Automotive News).
New Zealand dairy: HighGround Dairy on Let's Chat Dairy (Sep 25) says New Zealand milk production is "still one of excess," with "a pretty bold peak" expected this season. That means more product heading to export markets, and cheap milk fat "creating an interesting test of demand elasticity." More supply and soft fat prices are not a helpful mix for the kiwi's main export. (Insider: a dairy market research firm.)

What changed

Norway went from "hold" to hike, and from footnote to favourite. Last week Nomura expected Norges Bank, the Riksbank and the Swiss National Bank all to hold. Two of the three stuck to the script. Norway didn't. It hiked to 4.5% and extended its high-rate guidance through 2027. J.P. Morgan went from calling for a hold to "leaning even more into" a bullish krone view. Last week the Nordic legs of this letter were described as "the calm ones." This week Norway is the most interesting currency in the group.

Australia went from silent to centre stage. Last week we noted the RBA "didn't feature" and the Aussie was quiet. This week it had the most detailed conversations of any currency: a Bloomberg economist changing his call, Nomura putting numbers on the odds, MUFG on how much is priced. And the driver is specific: imported diesel, not a booming economy.

Canada's rate debate flipped. Last week IceCap warned the loonie "could weaken significantly" if the Bank of Canada didn't hike. This week the governor all but signalled a hike, and markets price about 50 basis points by January. The loonie still didn't move. The worry has shifted from "will they hike?" to "does it even help against this dollar?"

Oil and diesel went their separate ways. Last week crude held around $100-107 while diesel set records. This week crude had its longest losing run in a year, and diesel pushed to a fresh all-time high anyway. The squeeze is now at the refineries, not the oil wells. That matters a lot for diesel-importing Australia and much less for crude-exporting Canada.

What didn't change: the dollar is still the headwind over the whole group, Hormuz is still the headline that could reset everything, and China is still the swing buyer that nobody can quite read.