First Rate Increase in 20 Years From the Norwegian Central Bank
The Norwegian Central Bank raised the interest rate by 59 basis points to 1.25%, above the expectations of 25 basis points. This is the first rate increase in 20 years from the Norwegian Central Bank
First rate increase in 20 years from the Norwegian Central Bank. The Norwegian Central Bank decided to increase the benchmark interest rate above the forecasts.
In the statement made by the bank, it was stated that the benchmark interest rate was increased from 0.75% to 1.25%.
Market expectations pointed to a 25 basis point increase in interest rates.
The bank also increased the interest rate by 25 basis points after the meetings held in September and December of 2021 and in March of this year.
Consumer prices in Norway are 5.7 percent annually, while core inflation is 3.4 percent.
Ida Wolden Bache, Governor of Norway’s Central Bank, said that an interest rate increase is needed to reduce inflation to the 2 percent target. “We clearly need higher interest rates to ensure inflation stabilizes around the target.”
After Fed’s Decision to increase the rates by 75 basis points other countries are fallowing suit and increasing their rates one by one.