By Dominic Chopping
Norway's central bank held its key policy rate at 4.5% and reiterated guidance that the rate is likely to stay at that level for some time, as high wage growth and a weak krone are keeping inflation elevated.
The decision was in line with a Dow Jones poll.
Inflation is slowing but is still "markedly" above the 2% target while business costs have increased sharply in recent years, the bank said Friday.
"The committee assesses that the policy rate is sufficiently high to return inflation to target within a reasonable time horizon," it said in a statement.
Norges Bank noted that monetary policy is having a tightening effect and growth in the Norwegian economy is low, but interest-rate expectations abroad have risen and the krone is somewhat weaker than assumed.
Ahead of the bank's next monetary policy report in June, it said the committee will have received more information about economic developments.
"The data so far could suggest that a tight monetary policy stance may be needed for somewhat longer than previously envisaged," it added.
There were no new forecasts presented Friday, but in March the central bank signaled the policy rate would remain at around 4.5% until autumn 2024 before gradually falling.
Write to Dominic Chopping at dominic.chopping@wsj.com
(END) Dow Jones Newswires
05-03-24 0433ET
