Norges Bank holds policy rate at 4% and says it is in no hurry to cut

Norges Bank left its policy rate unchanged at 4 per cent, the Norwegian central bank announced on 6 November 2025. The Monetary Policy and Financial Stability Committee, which met on 5 November, took the decision unanimously.

The committee said no new information had come in since its September meeting to indicate a material change in the outlook for the Norwegian economy. It said the outlook was uncertain, but that if the economy evolved broadly as envisaged, the policy rate would be reduced further in the course of the coming year.

“The job of tackling inflation has not been fully completed, and we are not in a hurry to reduce the policy rate”, said Governor Ida Wolden Bache.

INFLATION STILL ABOVE TARGET

Twelve-month consumer price inflation rose to 3.6 per cent in September, while inflation adjusted for tax changes and excluding energy products (CPI-ATE) eased to 3.0 per cent. The committee said high services inflation was keeping domestic inflation elevated and that food inflation remained high, while imported goods inflation had been low over the past year.

On the labour market, registered unemployment rose to 2.2 per cent in October, and unemployment measured by the Labour Force Survey has held at 4.7 per cent since July. Norges Bank said unemployment had increased somewhat and capacity utilisation had declined to a normal level. The committee also noted that the krone had weakened since the September meeting and was somewhat weaker than projected.

GRADUAL PATH

Norges Bank began what it called a cautious normalisation of monetary policy in June and cut again in September, lowering the policy rate from 4.5 per cent to 4 per cent over the two moves. The rate path published in September was consistent with one cut a year over the following three years. The bank said a higher rate than envisaged could be required if inflation stayed elevated for longer, while the rate could be lowered faster if inflation returned to target sooner or the labour market weakened more than expected. New forecasts are due with the next decision on 18 December 2025.