Norges Bank leaves its rate unchanged 0.0%, as expected; the sharp economic downturn and considerable uncertainty surrounding the outlook suggest keeping the policy rate on hold until there are clear signs that economic conditions are normalising

• Increased Covid-19 infection rates and more containment measures abroad and in Norway will likely put a brake on the upswing in the coming period.


• So far, economic developments have largely been in line with the projections in the September Report
  


• House prices have risen more than projected in the September Report, while household credit growth has been as expected.


• The Norwegian economy is in the midst of a deep downturn.


• Oil prices have declined and are lower than in September.


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Reaction details (09:07)

• No reaction seen in the NOK post-decision as rates were left unchanged as expected and the statement provided little colour

Analysis details (09:10)

• Overall, the decision was as expected. With the Norges Bank acknowledging the increased COVID-19 cases and the impact this will have on economic developments; but, again as expected given this is an interim meeting, did not offer any indication as to how this will impact the rate path ahead. Finally, the Bank noted that oil prices have declined since the previous meeting but did not offer any further commentary - again, as expected, as it would be prudent for the Bank to wait until Decembers MPR post the OPEC+ gathering to provide a more detail update on the oil market.

05 Nov 2020 - 09:00- EnergyGeopolitical- Source: Newswires