Norway’s Norges Bank kept its policy rate unchanged at 4.0 percent, judging that unexpectedly high inflation, stronger‐than-projected wage growth and still-tight capacity utilisation require a continued restrictive stance and likely warrant a rate increase “at one of the forthcoming monetary policy meetings” to safeguard the 2 percent inflation target. The decision follows two 25 bp reductions between June and September 2025 that lowered the rate from 4.5 percent to the current level. The Committee noted that the krone has appreciated markedly, which should temper imported inflation, but headline price growth has recently exceeded forecasts and energy and wage developments risk entrenching inflation expectations. Capacity utilisation remains close to normal, unemployment is slightly below December projections, and Regional Network contacts report marginally easier recruitment conditions; the Bank still expects registered joblessness to drift back to pre-pandemic levels. Externally, the Middle East war has driven sharp rises in oil and gas prices, weaker global equity markets and higher domestic and foreign yields, developments seen as inflationary and growth-dampening. The policy-rate path has been revised up, pointing to 4.25–4.5 percent by end-2026, and the Committee stressed that if price pressures persist a higher rate may be needed, while weaker labour markets or faster disinflation could lead to a lower path.
Norges Bank 2026-03-26
Norges Bank holds policy rate steady at 4.0 %
Norges Bank kept its policy rate at 4.0 % but warned that persistent inflation, stronger wage growth and tight capacity may require a hike at forthcoming meetings to protect the 2 % target. Its revised rate path now points to 4.25–4.5 % by end-2026, albeit contingent on inflation and labour-market developments.