OSLO: Norway’s central bank kept its key policy interest rate unchanged at a record low 0.50 per cent on Thursday, as expected by all 16 economists polled by Reuters.

The outlook and the balance of risks for the Norwegian economy do not appear to have changed substantially since the December rate meeting, the board of Norges Bank said in a unanimous decision.

“The Executive Board’s assessment is that the upturn in the Norwegian economy appears to be continuing, broadly in line with the picture presented in December,” it added.

Norges Bank late last year announced plans to start a gradual tightening of policy in December of 2018, while its previous view had been that rates would begin to rise only by mid-2019.

Although oil producer Norway has recovered from a 2014-2016 slump in the price of crude, with higher growth and lower unemployment predicted for 2018, the economy is still operating at below-normal capacity, according to the central bank.

“This was exactly as expected and no new signals about the direction for rates going forward,” DNB Markets Chief Economist Kjersti Haugland said.

The crown currency weakened slightly on the news, trading at 9.6030 against the euro at 0910 GMT against 9.5900 just ahead of the announcement.

“The outlook and the balance of risks for the Norwegian economy do not appear to have changed substantially since the December report. The executive board therefore decided to keep the key policy rate unchanged at this meeting,” central bank Governor Oystein Olsen said in a statement.

Reuters