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Norway Central Bank Continues To Signal March Hike

Norway's central bank left its key interest rate unchanged for a third policy session in a row, in line with expectations, and reiterated that it would most likely be raised in March.

The Executive Board kept the key policy rate unchanged at 0.75 percent, the Norges Bank said in a statement. The decision was in line with economists' expectations.

In September, the interest rate was raised by a quarter basis points, which was the first hike since 2011.

"Overall, new information indicates that the outlook for the policy rate for the period ahead is little changed since the December Report", Norges Bank Governor Oystein Olsen said.

In its latest Monetary Policy report, released in December, the Executive Board's assessed that the capacity utilization in the Norwegian economy was close to a normal level. Policymakers saw underlying inflation close to the 2 percent target.

"The Executive Board's assessment of the outlook and balance of risks suggested that the policy rate would most likely be raised in March 2019," the bank said.

The outlook and the balance of risks imply a gradual increase in the policy rate, the Norges Bank said.

Global growth has turned out to be little weaker than projected and there remains considerable uncertainty surrounding the outlook.

Domestic growth and labor market developments appear to be broadly as projected, while inflation has been slightly higher than expected, the central bank noted.

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