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OSLO, Jan 21 (Reuters) – Norway’s central bank kept its main policy interest rate at a low level of zero, as expected, and said the economy was developing broadly as expected.
Norges Bank has said it expects rates to rise early next year as the economy recovers from the coronavirus pandemic, which could make it the first among central banks G10 to increase borrowing cost.
“The committee’s current assessment of risk forecasting and balancing indicates that the policy level is likely to remain at the current level for some time to come,” Governor Oeystein Olsen said in a statement.
“The severe economic downturn and considerable uncertainty over the outlook indicate that the level of policy will be maintained until there are clear signs that economic conditions are normalizing,” Norges Bank said.
Norway’s economy is expected to grow, hit by higher unemployment and lower activity last year as the government seeks to restore COVID-19 emissions by 3.5% in 2021, according to a Reuters poll recent of economists.
The central bank has confirmed that the pace at which the Scandinavian country can introduce its vaccination program, which was launched four weeks ago, is crucial in the outlook for the economy. (Reporting by Victoria Klesty and Terje Solsvik, edited by Gwladys Fouche)