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MNI: Signs FX Affecting Prices Faster - Norges Bank Director

Norges Bank's Executive Director Monetary Policy Ole Christian Bech-Moen addresses the passthrough of FX to inflation.

MNI (LONDON) - There are signs that the passthrough from recent krone depreciation to domestic Norwegian prices may have come through faster than in the past, helping to explain weaker-than-expected inflation, Norges Bank's Executive Director Monetary Policy Ole Christian Bech-Moen said on Thursday.

Krone weakness has been a key variable for Norges Bank in its economic analysis and policy setting, with the Norwegian central bank yet to join in the wave of rate cuts underway in other advanced economies. Norges Bank has used a suite of different models that show a wide range of possible inflation effects from the krone's depreciation, but one possibility is that the effects have come through more rapidly than anticipated, although uncertainty around this assumption is high, said Bech-Moen, who addressed a Nordea seminar in London.

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MNI (LONDON) - There are signs that the passthrough from recent krone depreciation to domestic Norwegian prices may have come through faster than in the past, helping to explain weaker-than-expected inflation, Norges Bank's Executive Director Monetary Policy Ole Christian Bech-Moen said on Thursday.

Krone weakness has been a key variable for Norges Bank in its economic analysis and policy setting, with the Norwegian central bank yet to join in the wave of rate cuts underway in other advanced economies. Norges Bank has used a suite of different models that show a wide range of possible inflation effects from the krone's depreciation, but one possibility is that the effects have come through more rapidly than anticipated, although uncertainty around this assumption is high, said Bech-Moen, who addressed a Nordea seminar in London.

Keep reading...Show less