Norway's central bank keeps key rate unchanged at 0.5 pct

Norway's central bank on Thursday said its executive board decided to maintain the key policy rate unchanged at 0.50 percent.

"The outlook and the balance of risks for the Norwegian economy do not appear to have changed substantially since the March report. The key policy rate has therefore been kept unchanged at this meeting," Oystein Olsen, governor of Norges Bank, was quoted as saying in a statement.

In the bank's Monetary Policy Report published in March 2017, it was the executive board's assessment that there was a continued need for an expansionary monetary policy, according to the statement.

Capacity utilization in the Norwegian economy was assessed to be below a normal level, and inflation was expected to range between 1 and 2 percent in the coming years, it said.

The executive board was of the view that the key policy rate would most likely remain at 0.5 percent in the period ahead.

In Norway, the key policy rate, also called the sight deposit rate, is the interest rate on bank deposits up to a quota in Norges Bank. Changes in Norges Bank's key policy rate will normally have a strong impact on short-term money market rates and on banks' deposit and lending rates.

The Norwegian central bank's next rate decision will be announced on June 22. Endit