MNI BRIEF: Norges Bank Hikes To 4.5%, Signals Rate Peak

Norges Bank hiked its poiicy rate by 25 basis points to 4.5% at its December meeting and stated that it then expected it to hold the rate steady "for some time to come.

Analysts were divided ahead of the decision over whether the central bank's Monetary Policy and Financial Stability Committee would tighten further but it the event it cited risks of elevated inflation and chose to go for what is likely a final 25 bps hike with an extended period of flat rates, the high-for-long strategy.

"The policy rate will likely be kept at 4.5 percent for some time ahead”, Governor Ida Wolden Bache stated, noting prospects for continued high wage growth and the krone depreciation keeing inflaiton elevated despite easing international price priessures. The detailed rate path published by the central bank showed the first cut coming between the final quarter of next year and the first quarter of 2025, suggesting a full year of a flat policy rate.