Norway's Central Bank Holds Steady: Rate Cuts Expected in March

Norway's central bank kept its interest rate at a 17-year high of 4.50%, as expected. Economists anticipate rate cuts beginning in March, aligned with other Western banks. The bank also expressed concerns about global trade barriers affecting growth and inflation.

Norway's central bank, Norges Bank, decided to maintain its policy interest rate at 4.50%, marking a 17-year high. This decision aligns with the unanimous forecasts made by analysts in a Reuters poll. The bank plans to initiate rate cuts starting in March, amidst changing global economic landscapes.

Governor Ida Wolden Bache noted the likelihood of a reduction in the policy rate come March, marking the first cut since May 2020. The central bank is predicted to reduce rates three times in 2025, aiming for a year-end rate of 3.75%. Updated forecasts are expected in March.

Norwegian central bankers have voiced concerns over potential increases in international trade barriers, which could hinder global growth and create uncertainty for Norway's price outlook. Meanwhile, the Norwegian crown remained stable against the euro, with most analysts predicting a rate cut to 4.25% in March.

(With inputs from agencies.)