OSLO (Reuters) – Norway’s central bank raised its main interest rate on Thursday, as expected, and said its next hike may come earlier then previously planned, strengthening the crown currency against the euro.
The bank raised its key policy rate to 1.0 percent from 0.75 percent previously, in line with the forecast of 23 out of 26 economists in a Reuters poll.
Norges - Bank - Approach - Contrast - US
Norges Bank’s approach stands in contrast to those of the U.S. Federal Reserve, the European Central Bank and others in Europe, which are keeping rates on hold due to rising uncertainty about the prospects for the global economy.
“Our current assessment of the outlook and balance of risks suggests that the policy rate will most likely be increased further in the course of the next half-year”, said Governor Oeystein Olsen.
Rate - Path - Probability - Rate - Hike
“The rate path shows a greater probability of a rate hike than of an unchanged rate in June,” he added.
The new rate path shows the bank sees rates averaging 1.1 percent in 2019, against 1.0 percent seen previously, and 1.6 percent in 2020, against 1.4 percent before.
Decision - Norway - Currency - Crown - Percent
Following the unanimous decision, Norway’s currency, the crown, surged over one percent against the euro to trade at 9.6010 at 0913 GMT and was pushing toward its biggest one-day gain in over...
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