OSLO, Aug. 13 (Xinhua) -- Norway's central bank on Thursday kept its policy rate unchanged at 4.25 percent, while saying that a further rate increase may still be necessary as inflation remains above target.
Norges Bank's Monetary Policy and Financial Stability Committee unanimously decided to maintain the rate at its meeting on Wednesday, the bank said in a statement.
Inflation has slowed and come in below forecasts this summer, but it is too early to conclude that the inflation outlook has changed materially, Norges Bank Governor Ida Wolden Bache said.
"It may thus still become necessary to raise the policy rate," she said.
Norway's year-on-year consumer price inflation stood at 3.0 percent in July, compared with the central bank's target of 2 percent.
Norges Bank said inflation had been lower than projected, with core inflation in July coming in 0.6 percentage points below its June forecast. However, it noted that the main underlying drivers of inflation appeared to have changed little, while the rapid rise in business costs in recent years was likely to keep price growth elevated.
Norges Bank raised the policy rate from 4 percent to 4.25 percent in May and left it unchanged in June. Its June forecast indicated that the rate could rise to slightly above 4.5 percent by the end of 2026.
The bank is scheduled to publish its next monetary policy report and rate decision on Sept. 24.
