New interest rates take effect in the New Year

Norges Bank. CEO interest ratesCEO Øystein Olsen in Norges Bank. Photo: Tore Meek / NTB scanpix

Experts rule out that Norges Bank will touch the key interest rate in Thursday’s meeting. A new increase in interest rates can be set earliest in the first quarter of next year, it is estimated.

 

Norges Bank raised the key interest rate from a record low of 0.5 per cent to 0.75 per cent at its meeting in September.

“That they should make some changes now is completely unlikely. Norges Bank raised interest rates at the previous meeting and indicated that they will be careful,” says Nordea’s chief analyst Erik Bruce to NTB.

Chief Economist Andreas Benedictow at Socio-Economic Analysis has the same opinion.

“After the first interest rate hike in such a long time this past September, there will probably not be any new interest rate hikes until 2019,” he told NTB.

Go ahead

The increase in interest rates in September was the first in seven years. Already in the first quarter of next year, most likely at the monetary policy meeting in March, the key rate will be raised by a new 0.25 percentage point. Most likely, there will be another increase in 2019, towards the end of the year, shows the central bank’s monetary policy report in September.

Thursday’s meeting is a standard meeting, where there won’t be any comprehensive new reviews from Norges Bank.

“There have been very few updates since its last meeting. They are going to say that the picture is as expected,” Bruce says.

“The real economy is still good, but several factors indicate that Norges Bank should look at further developments before further interest rates are raised,” comments Benedictow.

 

© NTB scanpix / #Norway Today

 

 

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