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Policy Report Highlights

NORGES BANK
  • Looks to confirm front-loading of policy rate hikes: "A faster rate rise now will reduce the risk of inflation remaining high and the need for a sharper tightening of monetary policy further out"
  • Key driver for rate path is high economic activity meeting "little spare capacity". This is a firming of language after March's "above a normal level".
  • Balance of risks leaves chance of faster action required than statement suggests: if sustained global inflationary pressure persists "the policy rate may be raised more than currently projected."
  • On the jobs market, report points directly to output constraints a key driver for capacity constraints: "output constraints due to labour shortages is now just as high as preceding the financial crisis"
Full monetary policy report and data files found here: https://www.norges-bank.no/en/topics/Monetary-poli...

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