Norway Interest Rate

The Norges Bank kept its key policy rate steady at 4.5% for the tenth consecutive meeting in March 2025, as widely expected. Policymakers noted that inflation has risen sharply and remains significantly higher than anticipated. They cautioned that lowering the policy rate too soon could fuel further price increases. Norway’s annual inflation rate accelerated to 3.6% in February 2025, up from 2.3% in January, marking the highest level since April 2024. Despite this, officials indicated that their current outlook suggests a rate cut will likely occur later in 2025, though uncertainty remains over future economic developments. The central bank’s policy rate forecast aligns with a reduction to 4% by the end of the year, followed by a gradual decline in subsequent years.