Denmark's central bank is reaching for bigger bazookas to battle the speculators betting it will be forced to abandon its currency's peg to the euro.
"They've thrown the proverbial policy toolkit at defending the euro-Danish peg," Kamal Sharma, a foreign currency strategist at Bank of America Merrill Lynch, told CNBC Thursday. "They will continue to intervene with the possibility of further rate cuts, even the tail risk of the recalibration of the trading range."
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Bets that the krone will rise are building. Some of the flows have headed for Denmark's stock market, with Danish-focused mutual funds and exchange-traded fund (ETFs) seeing $230 million in inflows over the past six weeks, according to data from Jefferies.
Slings and arrows
Barclays analysts called it "the slings and arrows of market speculation."