By Paul Hannon
Norway's central bank held its key policy rate at 4.5% and reiterated guidance that the rate is likely to stay at that level for some time, as high wage growth is expected to keep inflation elevated.
The central bank said Thursday that while inflation has cooled, it remains above target, while surveys suggest that wages might rise more rapidly than previously anticipated. Policymakers worried that a cut in the key rate could cause inflation to remain above their target for longer than they would like.
The central bank said it is unlikely to cut its key rate this year.
"If the economy evolves as currently envisaged, the policy rate will continue to lie at 4.5 percent to the end of the year, before gradually being reduced," said Norges Bank Governor Ida Wolden Bache.
A growing number of European central banks have lowered borrowing costs as inflation cools. Earlier Thursday, Switzerland's central bank lowered its key rate for a second policy meeting.
Write to Paul Hannon at paul.hannon@wsj.com
(END) Dow Jones Newswires
06-20-24 0426ET
