Chief economist at Sparebank 1 believes Norges Bank should increase key interest rate by 0.75%

Norges Bank should follow the US example and raise the key interest rate by 0.75%, says Elisabeth Holvik, chief economist at Sparebank 1.

Holvik told E24 that she does not think Norges Bank will raise interest rates that much.

“I think they will raise it by 0.5%, but there is nothing wrong with 0.75%,” Holvik said.

On Wednesday, the US Federal Reserve announced that it would raise the key interest rate by 0.75%, the largest interest rate jump in 28 years. This is due to high inflation, a fall in the stock market, and a stronger dollar.

Holvik believes that the developments in the USA should be a wake-up call for Norges Bank. By raising the interest rate by 0.25% as planned, the risk increases that Norway’s economy will also “overheat,” she believes. 

The Norwegian key policy rate is now 0.75%.

Source: © NTB Scanpix / #Norway Today / #NorwayTodayFinance

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