MNI BRIEF: Norges Bank Holds, Sees Easing In 2026

Norges Bank left its key policy rate on hold at 4% in December, as expected, and its policy committee said that if things evolved as expected that it expected the policy rate to be lowered further in the coming year. (see MNI NORGES WATCH: On Hold In December, Seen Wary on Cuts )

Governor Ida Wolden Bache said that "we are not in a hurry to reduce the policy rate" with the forecasts in the December Monetary Policy Report similar to those published in September. The policy rate in the Monetary Policy Report projection was shown at 3.9% in 2026 before declining to 3.4% in 2027 and 3.2% in 2028

Inflation was only expected to decline very gradually towards the 2% target on the core CPI-ATE measure and to be close to it in 2028. The 2026 CPI-ATE forecast was cut 0.1 percentage point to 2.7% and 2027 raised 0.1 to 2.4%.