Norway's Central Bank Holds Interest Rate Steady, Signals Likely Cut in March

Forex - The Norwegian Central Bank (Norges) did not change interest rates at its eighth consecutive meeting, in line with market expectations, and stated that a reduction is likely in March 2025. According to the announcement from Norges, the benchmark interest rate remained at 4.50%. Analysts also expected no change in the interest rate. Norges President Ida Wolden Bache stated, "The committee concluded that a tightening monetary policy is still needed to stabilize inflation near the target, but the time to begin easing monetary policy appears to be approaching soon." The committee noted in its discussion that activity in the Norwegian economy seems to be better than previously predicted. The statement added, “On the other hand, inflation is nearing the target, and inflationary pressures appear to be somewhat calmer than previously assumed. The committee does not want to restrict economic activity more than necessary to bring inflation down to the target within a reasonable time horizon." The bank indicated that inflation is projected to be just above 2% by the end of 2027.