Norway Holds Steady: Interest Rates at a 17-Year High Amid Inflation Concerns

Norway's central bank maintained interest rates at 4.50%, the highest in 17 years, due to inflation pressures. Analysts unanimously predicted this decision. The bank anticipates a rate reduction in 2025. The Norwegian crown slightly strengthened against the euro, contrasting with other Western banks cutting rates.

Norway's central bank has maintained interest rates at a 17-year peak of 4.50%, a move aligned with analysts' expectations, as surging inflation obstructs potential rate cuts.

Norges Bank Deputy Governor Paal Longva emphasized the risks of premature rate reduction, suggesting rates might decrease by 2025 based on current assessments. The Norwegian crown saw a minor uplift against the euro following the announcement.

In a March policy shift, Norges Bank halted anticipated rate cuts, opting to sustain the highest rates since 2008 in response to rising consumer prices. This approach diverges from other Western central banks, which have been lowering rates amid slowed growth and reduced inflation.

(With inputs from agencies.)