Norges Bank Preview: Forecasts from five major banks, last hike in December?

Norges Bank will announce a new rate decision on Thursday, December 15 at 09:00 GMT and as we get closer to the release time, here are the expectations forecast by the economists and researchers of five major banks regarding the upcoming central bank’s Interest Rate Decision.

NB is expected to hike rates by 25 basis points to 2.75%. At the last meeting on November 3, the bank hiked rates by 25 bps.

Nordea

“We still expect a 25 bps hike but have become less convinced that the key rate will need to be raised much further. Hence, the December hike to 2.75% could end up being the last hike from Norges Bank in this cycle.”

MUFG

“We expect another 25 bps hike with the potential for Norges bank to follow the BoC’s lead from last week and hint that they may be in a position to pause.”

TDS

“Another weak Regional Networks survey and softer headline and core inflation likely erased most of the risk of a 50 bps hike at Norges Bank’s Dec meeting. That said, inflation is still running much hotter than the Bank’s forecast (CPI: 1.1ppts, CPI-ATE: 0.7ppts) and GDP data has consistently been surprising to the upside. Therefore, we wouldn’t entirely rule out a 50 bps move.”

Swedbank

“We expect a 25 bps hike in December, followed by a signal that the policy rate may be increased further in Q1 if needed, meaning the terminal rate will probably peak at somewhat below 3.00%. We expect Norges Bank to start cutting rates during second half of next year, but it is too early for the Bank to signal that already now.”

Danske Bank

“We expect 25 bps from Norges Bank.”