Norway raises key interest rate to fight inflation and expects further hikes ahead
Norway’s central bank says it has raised its key interest rate by half a percentage point in an effort to “bring inflation down to target.”
By AP News
Published - Jun 22, 2023, 04:57 AM ET
Last Updated - Jun 22, 2023, 04:57 AM EDT
COPENHAGEN, Denmark (AP) — Norway’s central bank said Thursday that it has raised its key interest rate by half a percentage point in an effort to "bring inflation down to target.”
Norges Bank said higher wage growth and a weaker-than-projected krone will raise inflation and that “international interest rates have risen more than anticipated.”
The Scandinavian country, which is not part of the European Union, had an inflation rate in May of 6.7%. That's far above the central bank's target of 2%.
“If we do not raise the policy rate, prices and wages could continue to rise rapidly and inflation become entrenched. It may then become more costly to bring inflation down again,” bank Gov. Ida Wolden Bache said in a statement.
