Norges Bank’s Monetary Policy and Financial Stability Committee lifted the policy rate 25 bp to 4.25 %, arguing that inflation remains above the 2 % target and is likely to stay elevated without firmer action. The rate had been held at 4 % since December 2025, following last year’s cumulative 50 bp easing, but the Committee now sees a higher stance as necessary to anchor expectations. March data showed headline CPI at 3.6 % y/y and CPI-ATE at 3.0 %, with wage settlements broadly in line with earlier projections; capacity utilisation is around normal, employment is still rising and registered unemployment is flat, though Labour Force Survey unemployment has edged up. A stronger krone should temper imported inflation, yet elevated oil prices and somewhat stronger external commodity-price pressures linked to the Middle East conflict pose upside risks. The March policy path still envisages a policy rate of 4¼–4½ % by end-2026, and the Committee reiterated that further tightening later in the year may be required if the economy deviates from current projections.
Norges Bank 2026-05-07
Norges Bank increases policy rate by 25 bp to 4.25 %
Norges Bank’s Monetary Policy and Financial Stability Committee raised the policy rate 25 bp to 4.25 %, stating that inflation remains above the 2 % target and upside risks persist. The policy path still foresees 4.25–4.5 % by end-2026, and further hikes later this year remain on the table if the outlook deteriorates.