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Could future interest rate hikes in Norway be scrapped due to lower inflation? 

Frazer Norwell
Frazer Norwell - [email protected]
Could future interest rate hikes in Norway be scrapped due to lower inflation? 
Norway's central bank could hold off from introducing anymore interest rate hikes. Pictured is a view of Bergen from the habour. Photo by Gatis Vilaks on Unsplash

Fresh inflation figures released in Norway on Tuesday mean that analysts believe the central bank may hold off from a planned key interest rate hike in December. 


Norway's central bank has raised interest rates 13 times since 2023. Its latest hike arrived in September. 

The bank has been raising rates from the historic low of zero to try and prevent the economy from overheating and slow inflation. 

The current interest rate in Norway is 4.25 percent. When the last raise was announced, the central bank said another would likely follow in December. 

However, inflation figures have been lower than many analysts have expected. 

Prices in September were 3.3 percent higher than the same month a year prior, according to figures from Norway's national data agency, Statistics Norway.

Norway's 12 monthly inflation figure for September was 1.5 percentage points lower than the yearly figure a month before, however.

In August, the Consumer Price Index, a measure of inflation, was 4.8 percent higher than the same month last year.

"High price growth has been the reality for a long time. Now, on the other hand, we have seen a decrease in price growth in recent months, and from August to September, it decreased by a full 1.5 percentage points," Espen Kristiansen from Statistics Norway said.


Ola Grytten, economics professor at the Norwegian School of Economics (NHH), told public broadcaster NRK that the inflation figure was a sign that Norway's central bank may hold off from the interest rate hike in December. 

"Regardless, today's figures are good news for those struggling with high loan interest rates. The figure may indicate that inflation is reversing earlier than previously thought. But we have to talk about October and November before we are completely sure," Grytten said. 

Dane Cekov, a senior strategist at Nordea Market, also believes that the current interest rate will be the peak. 

"The chance that interest rates will be raised in December is significantly reduced. We don't think Norges Bank will raise it," Cekov said. 

Food and energy prices contributed to the lower inflation figures. 

"From August to September last year, electricity prices rose sharply, while food prices were unchanged. This year, the prices for both of these product groups fell in the same period. This pulled the twelve-month growth in the CPI sharply down," Kristiansen said.


In September this year, energy prices, including network rent, were 43.9 per cent lower than in September last year. From August to September, food prices fell by 1.5 percent.

The figures for September mark the fifth month in a row that price growth in Norway has slowed. The CPI in September also saw the lowest growth for almost two years.

Marius Gonsholt Hov, the chief economist of Handelsbanken, said that the inflation figures were a game changer. 

"We have finally received numbers that are encouraging in terms of saying that we have reached the interest rate peak," Hov told the business news site E24

"This could be a 'game changer'," he added. 

Meanwhile, Kjetil Olsen, chief economist at Nordea Markets, said the central bank may adopt a new interest rate path. 

Under the current plan, the central bank said that it was likely to cut interest rates towards the end of 2024. 


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