Norges Bank keeps policy rate unchanged at 0.75%

Norway’s central bank kept its key policy rate unchanged at 0.75% on Thursday.

The majority of economists had been expecting the bank to stand pat, although some had been looking for a cut to 0.5%.

"An overall assessment of the outlook and balance of risks led the Executive Board to conclude that the key policy rate should be kept unchanged at this meeting. If economic developments are broadly in line with projections, the key policy rate may be reduced in the first half of 2016", said governor Oeystein Olsen.

Norges Bank said the effects of the fall in oil prices and the drop in oil investment on the Norwegian economy are gradually becoming evident.

Going forward, household consumption and private sector investment are expected to be lower than previously projected.

However, an expansionary fiscal policy will support demand for goods and services, the bank said.

Overall, it pointed to prospects that growth will be somewhat weaker than anticipated, noting that unemployment is expected to rise slightly more than projected in the September Monetary Policy Report.