MNI BRIEF: Norges Bank On Hold, Sees Next Hike Likely March

Norges Bank left the policy rate unchanged at 2.75% with Governor Ida Wolden Bache stating that the next hike was likely in March, with the commentary pointing to a 25bps hike, in line with MNI's expectation (MNI NORGES WATCH: Norges Seen Keeping Hike For March Meeting).

There was no new set of forecasts accompanying the Monetary Policy and Financial Stability Committee's decision but its analysis said the domestic labour market was tight, perhaps slightly more so the central bank had expected. The upward pressures from the labour market were offset, however, by the expectations of lower energy prices and the previous swift rate hikes appeared to be having a dampening effect on the economy.

The committee's stateement said developments "may mean moving forward more gradually in setting interest rates" and Wolden Bache said "We will most likely raise the interest rate in March,," which points to a 25bps hike which would be in line with December's policy projections.