Norges Bank Raises Policy Rate to 4.5% as Expected

2026-09-24 08:07 By Judith Sib-at 1 min. read

Norges Bank raised its policy rate by 25 bps to 4.5% in September 2026, in line with expectations, as policymakers stepped up efforts to contain inflation.

While underlying inflation has been lower than expected this summer, the inflation outlook has not changed significantly.

The US-Iran war continues to cloud the price outlook, with oil, gas and other raw-material prices rising.

The bank noted that the sharp increase in business costs in recent years is likely to keep inflation elevated ahead, adding that sustained high inflation could lead firms and households to expect price pressures to persist, making it harder to reduce.

Norges Bank therefore signaled that rates may need to remain high for some time and is prepared to tighten further if necessary to return inflation back to its 2% target within a reasonable timeframe.

Meanwhile, economic activity grew broadly as expected and employment continued to rise, while capacity utilization fell slightly less than previously estimated.



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Norges Bank Raises Policy Rate to 4.5% as Expected
Norges Bank raised its policy rate by 25 bps to 4.5% in September 2026, in line with expectations, as policymakers stepped up efforts to contain inflation. While underlying inflation has been lower than expected this summer, the inflation outlook has not changed significantly. The US-Iran war continues to cloud the price outlook, with oil, gas and other raw-material prices rising. The bank noted that the sharp increase in business costs in recent years is likely to keep inflation elevated ahead, adding that sustained high inflation could lead firms and households to expect price pressures to persist, making it harder to reduce. Norges Bank therefore signaled that rates may need to remain high for some time and is prepared to tighten further if necessary to return inflation back to its 2% target within a reasonable timeframe. Meanwhile, economic activity grew broadly as expected and employment continued to rise, while capacity utilization fell slightly less than previously estimated.
2026-09-24
Norges Bank Keeps Interest Rate at 4.25%
The Norges Bank kept its policy rate steady at 4.25% in August, in line with market expectations, as inflation slowed more than anticipated over the summer. CPI inflation fell to 3% in July, while underlying inflation declined to 2.7%. However, both measures remain above the central bank’s 2% target, meaning policymakers believe it is too early to conclude that inflation is sustainably moving lower. The Bank therefore maintained its restrictive monetary policy stance and warned that another rate hike could still be necessary. Economic activity and labour-market conditions have developed broadly as expected, although housing prices fell sharply in July and construction remains weak. The krone has recovered somewhat after weakening earlier in the summer. The next major signal will come in September, when new economic forecasts are published and policymakers reassess the future path of interest rates.
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