The Norwegian Central Bank increased the policy rate by 50 basis points, above the expectations, and signaled a possible increase in August.
Interest rate increases from central banks of developed countries follow each other. After Switzerland, Norway also decided to continue tightening.
The Norwegian Central Bank increased its policy rate by 50 basis points to 3.75 percent. The expectation of economists participating in the Bloomberg survey was that the interest rate would be increased to 3.50 percent.
While the policy rate in Norway was increased beyond expectations, it was signaled that the tightening would continue in the resolution text. In the text, it was emphasized that it is possible to increase the policy rate again in August.
Norwegian Central Bank officials predicted that the interest rate could rise to 4.25 percent towards the end of the year.
In May, annual inflation in the country rose to 6.7 percent. In November 2022, annual inflation in Norway hit a record 7.5 percent.
After the decision, the Norwegian currency appreciated against the dollar.