The monetary policy committee at Norway’s central bank (Norges Bank) has decided once again to keep its policy rate unchanged at 4.5 percent. It’s now expected to stay there through the end of the year.
The decision to drop any long-sought reduction in interest rates bucks the trend in other countries, where rates have fallen. Norway’s currency, the krone, remains very weak and fell again after this week’s US presidential election when the dollar strengthened. On Wednesday it cost more than NOK 11 to buy one US dollar, and the krone is also very weak against other currencies including the euro and British pound.
The central bank noted how interest rates were raised “significantly” in recent years, in order to cool down the Norwegian economy and lower the inflation rate. The policy rate has remained at 4.5 percent, though, since last December, so there have been expectations that the bank’s committee would finally lower rates for borrowers. Now that’s not likely until the first quarter of 2025, mostly because of the weak krone and an ongoing “need to bring inflation down to target (2 percent) within a reasonable time horizon.”
NewsinEnglish.no staff
