Norges Bank’s Monetary Policy and Financial Stability Committee lifted the policy rate 25 bp to 4.25 %, arguing that inflation remains above the 2 % target and is likely to stay elevated without firmer action. The rate had been held at 4 % since December 2025, following last year’s cumulative 50 bp easing, but the Committee now sees a higher stance as necessary to anchor expectations. March data showed headline CPI at 3.6 % y/y and CPI-ATE at 3.0 %, with wage settlements broadly in line with earlier projections; capacity utilisation is around normal, employment is still rising and registered unemployment is flat, though Labour Force Survey unemployment has edged up. A stronger krone should temper imported inflation, yet elevated oil prices and somewhat stronger external commodity-price pressures linked to the Middle East conflict pose upside risks. The March policy path still envisages a policy rate of 4¼–4½ % by end-2026, and the Committee reiterated that further tightening later in the year may be required if the economy deviates from current projections.
Norges Bank increases policy rate by 25 bp to 4.25 %
Norges Bank’s Monetary Policy and Financial Stability Committee raised the policy rate 25 bp to 4.25 %, stating that inflation remains above the 2 % target and upside risks persist. The policy path still foresees 4.25–4.5 % by end-2026, and further hikes later this year remain on the table if the outlook deteriorates.