Norges Bank: Policy rate seen elevated for longer – Nordea
Nordea’s Kjetil Olsen notes that Norges Bank raised its policy rate by 25bp to 4.5% and lifted the policy rate path, implying some risk of a further hike over the next six months.
Nordea's Kjetil Olsen reports that Norges Bank increased its policy rate by 25 basis points to 4.5%, signaling a potential further hike within the next six months. The bank anticipates modest economic growth at around 1% and a slight rise in unemployment. Kjetil Olsen predicts that interest rates will remain near the current levels for an extended period, only gradually declining afterward.
Norges Bank does not foresee any rate cuts before 2028. The bank's assessment indicates that inflation expectations have not changed significantly since June, despite lower inflation during the summer months and a slightly stronger Norwegian krone. This outlook is influenced by external factors such as energy and commodity prices.
In the short term, interest rates are expected to stay around their current levels, with minimal declines anticipated once any rate adjustments occur.
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