Investing.com — The Danish krone took a dip after disappointing clinical trial results from Danish pharmaceutical giant Novo Nordisk (NYSE:) A/S. The results have raised concerns about the potential impact on the Nordic country’s economy.
On Friday in Copenhagen, the krone traded at 7.4614 against the euro, down slightly from 7.4592 before the Novo Nordisk data release. Despite the dip, the krona remained within the range of 7.2925 to 7.6282 against the euro, as set by the central bank to maintain the currency peg. According to market analysts, there were no indications of an intervention in the foreign exchange market.
The decline was driven by data from Novo Nordisk, which showed that patients taking the experimental obesity drug CagriSema lost less weight than expected in a study. The news sent Novo shares plunging as much as 29%, their biggest drop ever, and dragged Denmark’s benchmark OMXC25 index down more than 5%.
Kristoffer Kjaer Lomholt, head of FX research at Danske Bank (CSE:) A/S noted that the Novo Nordisk sell-off contributes to the strengthening of the euro against the Danish krone. He added that flows from the corporate sector, including those from pharmaceutical companies, have gained significant importance in recent years, especially with the rise of Novo Nordisk.
Despite the dip, Lomholt emphasized that market volumes were thin due to the upcoming Christmas holidays and assured that there was no immediate need for an intervention in the market.
In recent years, the Danish economy has become increasingly dependent on Novo Nordisk.
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