Norway’s central bank left interest rates on hold on Thursday at a 17-year high of 4.5%, as expected.
Source: Sharecast
Deputy Governor Paal Longva said: "The Committee has decided to keep the policy rate unchanged. Inflation is still above target. If the policy rate is lowered prematurely, prices may continue to rise rapidly."
On the other hand, Norges Bank said, an overly tight monetary policy could restrict the economy more than needed to bring inflation down to target.
Longva said trade barriers have become more extensive and there is uncertainty about future trade policies.
"This may pull the interest rate outlook in different directions," he said. "There is uncertainty about future economic developments, but the Committee’s current assessment of the outlook implies that the policy rate will most likely be reduced in the course of 2025."
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