Norges Bank expected to keep rates unchanged – Danske Bank

Sverre Holbek, Senior Analyst at Danske Bank, expects the Nordic central bank to refrain from changing its monetary conditions at today’s meeting.

Key Quotes

“We expect Norges Bank to stay on hold. This is only an ‘interim’ meeting with no new monetary policy report or press conference, just a press release”.

“Traditionally, it has taken a big change in the outlook for NB to touch interest rates or put out any new signals at all at such meetings. Since the previous ‘full’ meeting in September, data has been somewhat on the weak side but nowhere near bad enough for NB to have changed its stance in only a little over a month, especially as some of this weakness is on the back of a period of very strong data, particularly in manufacturing”.

“While inflation was also somewhat lower than expected in September, this was due almost entirely to lower food prices rather than a broad-based slowdown in prices”.

“In addition, although unemployment now seems to be falling slightly more slowly th an earlier this year, this is probably no more than Norges Bank expected. The October telephone round of the regional network survey (not a full report) also revealed little change in firms’ expectations since August”.