In a surprise decision, Norway’s benchmark interest rate has been raised by 25 points by the Norwegian central bank to persistent inflation. A decision that would stay at the level until the end of 2024.
Leading up to the decision, 27 economists were polled by Reuters whether rates would change. 15 had expected rates to stay put, whereas 12 had predicted the hike of 4.50%.
Speaking in a press conference, Governor Ida Wolden Bache said that the bank was ready to hike benchmark interest rates if necessary, but would also be willing to cut rates if inflation were to fall quicker that expected.
“If the economy evolves as currently envisaged, there will not be a need for additional rate hikes,” mentioned Bache.
“The forecast indicates that the policy rate will continue to lie around 4.5% until autumn 2024 before gradually moving down,” added Bache.