Icelandic Króna in Free-Fall Skip to content

Icelandic Króna in Free-Fall

By Iceland Review

The currency rate of the Icelandic króna has been in free-fall since business began this morning at 9:15. The ISK has depreciated by more than four percent and the exchange rate index is currently at 188 points, up from 179.5 since this morning.

USD 1 is currently ISK 100.5, EUR 1 is currently ISK 143.55 and GBP 1 is currently ISK 180.50, reports.

Last weekend it was announced that the Central Bank of Iceland was not part of an agreement between the central banks of the USA, Denmark, Sweden and Norway on access to US dollars, Morgunbladid reports.

Experts say that a low flow of foreign currencies in the market is a factor in the depreciation of the ISK and they fear that if it weakens more serious consequences could await several individuals and companies.

Iceland’s Prime Minister Geir H. Haarde remains optimistic, predicting that the depreciation of the ISK in the past few days is only a temporary situation, Fréttabladid reports.

Haarde seemed confident that the currency rate of the ISK would stabilize in the near future, as he said in an interview on the political chat program Mannamál on Stöd 2 last night.

Haarde explained that there were two main reasons for the rapid depreciation of the ISK; shortage of foreign currency in international financial markets and the adjustment of the currency rate of the ISK after the execution of heavy industry projects.

The prime minister also stated that after the US present a strategy to improve their economic situation today, global markets would stabilize.

Click here to read more about the development of the ISK.

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