Landsbanki Research has published a new long-term currency forecast. Once again things have darkened a little bit since their last report.
In the short run the ISK will continue to fluctuate near its current level. The deeper than expected and more persistent nature of the global credit crunch will delay any substantial ISK appreciation. Positive long-term prospects should boost the currency in 2009. This situation limits the flow of foreign currency into the country. Although the ISK has been in a weakening phase, they expect any further depreciation to be short-lived. The ISK will continue to be volatile until early next year.
