MNI BRIEF: Norges Bank Hikes 50bps; Sees Peak Just Over 3%

Norges Bank hiked its key policy rates by 50 basis points at its June meeting, taking the policy rate to 1.25% and it said that the next hike would likely come at its August meeting.

The Monetary Policy and Financial Stability Committee forecasts showed the policy rate rising to some 3% in 2023, before holding near steady with the rate in 2024 at 3.1%, up from the previous 2.5% projected peak, and then falling back to 2.8% in 2025.

Analysts had been divided over whether the Norwegian central bank would raise by 25 or 50 bps, and the larger move and higher peak were at the hawkish end of analysts' expectations although market pricing has shown even more aggressive tightening ahead.