Bloomberg News

Norway Inflation Picks Up as Central Bank Delays Rate Rises

October 10, 2011

(Updates with overall inflation in second paragraph.)

Oct. 10 (Bloomberg) -- Norwegian inflation accelerated last month as the central bank signaled it would delay planned interest rate increases amid a deepening European debt crisis.

The underlying inflation rate, adjusted for taxes, fees and energy prices, climbed to 1.2 percent in September from 0.8 percent a month earlier, Oslo-based Statistics Norway said today. The rate was forecast at 1 percent, according to the median estimate of 11 economists in a Bloomberg survey. Prices rose 1.2 percent in the month, led by a jump in clothing costs. Headline inflation was 1.6 percent, also faster than the 1.3 percent estimated in a survey.

The central bank, which targets price growth of about 2.5 percent, in August postponed plans to raise its benchmark rate and last month signaled it may keep rates unchanged at 2.25 percent until next year. Norway’s government last week presented a 2012 budget plan that will increase the use of its oil money and stimulate the economy by 0.3 percentage point amid concern that the euro area debt crisis will sap exports.

The krone was little changed at 7.8041 per euro and climbed 1 percent to 5.7702 per dollar as of 10:08 a.m. in Oslo.

Policy makers will meet on Oct. 19 to decide on interest rates and publish updated rate expectations.

--Editors: Jonas Bergman

To contact the reporter on this story: Jonas Bergman in Oslo at jbergman@bloomberg.net

To contact the editor responsible for this story: Tasneem Brogger at tbrogger@bloomberg.net


Best LBO Ever
LIMITED-TIME OFFER SUBSCRIBE NOW
 
blog comments powered by Disqus