Investing.com — The Danish krone fell following disappointing clinical trial results from Danish pharmaceutical giant Novo Nordisk A/S. The findings have raised concerns about the potential impact on the Nordic nation’s economy.
On Friday, the crown was trading at 7.4614 against the euro in Copenhagen, down slightly from 7.4592 before the Novo Nordisk data was released. Despite the decline, the krona remained within the 7.2925-7.6282 range against the euro, as set by the central bank to maintain the currency’s peg. According to market analysts, there have been no indications of intervention in the currency market.
The drop was triggered by data from Novo Nordisk, which revealed that patients using its experimental obesity drug, CagriSema, lost less weight than expected in one study. The news caused Novo’s shares to plunge as much as 29%, the biggest drop on record, and dragged the Danish benchmark OMXC25 index lower by more than 5%.
Kristoffer Kjaer Lomholt, head of FX research at Danske Bank A/S, noted that the massive selling of Novo Nordisk is contributing to the strengthening of the euro against the Danish krone. He added that corporate sector flows, including those of pharmaceutical companies, have gained significant importance in recent years, particularly with the rise of Novo Nordisk.
Despite the decline, Lomholt stressed that market volumes were reduced due to the upcoming holiday season and assured that there was no immediate need for market intervention.
In recent years, the Danish economy has become increasingly dependent on Novo Nordisk.
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