MNI Norges Bank Preview - May 2024: Little Reason to Pivot

The Norges Bank are unanimously expected to leave the policy rate on hold at 4.50% once again.

• Following the hawkish-leaning March decision, recent developments provide little reason for the Norges Bank to deviate from its current guidance.
• As such, we expect the statement to continue guiding for rates to be held at current levels for “some time ahead”.
• Although Governor Wolden Bache noted at the March press conference that September was the most likely meeting for rates to be cut, we don’t expect this to be explicitly included in the policy statement.
• Analysts are unanimous in expecting no change to the policy rate, and generally expect little change to Norges Bank’s guidance (i.e. rates to stay at current levels for “some time ahead”). Some note the risk of the Norges Bank downplaying guidance for a September cut, or even a more hawkish tilt in the policy statement language. The NOK would strengthen in response to such a move.

For our full preview including a summary of sell-side views, see the PDF here:

MNI Norges Bank Preview - 2024-05.pdf