NORGES BANK REVIEW: Relatively hawkish rate path offset by Governor Bache

A somewhat hawkish announcement from the Norges Bank. The Key Policy Rate was left unchanged at 4.50%; however, the policy path did not formalise a Q4-2024 rate reduction as some had been expecting given the recent moderation of inflation. Thereafter, this hawkish move was offset by the concluding remarks of Governor Bache in her press conference where she said that the rate path indicates a cut is most likely in September and then a second by the end of Q1-2025. Commentary which added a dovish twist to the unchanged path. Overall, the meeting doesn’t fundamentally change the narrative that the Norges Bank is waiting for the June MPR to formalise that it expects to commence the easing cycle in September. In the meantime, CPI-ATE will continue to draw scrutiny given its high absolute level relative to the 2.0% target.

21 Mar 2024 - 13:00- - Source: Newsquawk