Norway’s Central Bank Raises Key Rate For First Time Since Pandemic
Norway has become the first G10 currency issuing country to raise its rate since the start of the coronavirus pandemic. The country’s central bank raised it from zero to 0.25%, according to the watchdog’s website.
The overnight lending rate in Norway is set at 1.25% from September 24, while the reserve rate is 0.75%.
The Norwegian central bank chairman Oystein Olsen believes that the economy has returned to normal and therefore it is appropriate to « normalise the key rate ».
The next increase is expected in December.
Recall that the G10 group consists of the currencies with the highest trade volumes and liquidity. The G10 currencies include the US dollar, Canada, Australia and New Zealand, the euro, the pound sterling, the Swiss franc, the Norwegian and Swedish krona and the Japanese yen.
Similar decisions were taken by regulators in Brazil, Mexico, South Korea, the Czech Republic and Iceland.
In September, the European Central Bank and the US Federal Reserve kept rates around zero. At the same time, the US regulator noted that the decision to roll back the anti-crisis asset buyback programme may become « justified in the near future ».