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Norway Central Bank Signals Rate Hike

At the monetary policy meeting, Norway's central bank signaled that the interest rates will probably be raised in the second half of 2021.

The Monetary Policy and Financial Stability Committee on Thursday, unanimously decided to retain the policy rate at zero percent.

The bank expects a faster pick-up in economic activity than previously projected on improving global developments.

"The overall outlook and balance of risks imply a continued expansionary monetary policy stance," Governor Øystein Olsen, said. "When there are clear signs that economic conditions are normalising, it will again be appropriate to raise the policy rate gradually from today's level," Olsen added.

The bank forecast a gradual rise in the interest rate from the latter half of 2021.

Bank will tighten sooner and faster than it currently projects, and forecast the Norwegian krone to rise further this year, David Oxley, an economist at Capital Economics, said.

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