Page last updated at 13:53 GMT, Wednesday, 28 October 2009

Norway Europe's first to up rates

Oslo harbour
Inflation in Norway means rates are likely to rise again

Norway has become the first European country to raise its interest rates since the beginning of the global financial crisis.

The country's central bank raised the cost of borrowing to 1.5% from 1.25% in a widely-expected move.

It said the increase was needed because inflation was higher than expected and unemployment was "considerably lower than previously projected".

Earlier this month, Australia raised its interest rate to 3.25% from 3%.

The move made Australia the first country in the G20 to increase rates since the global economic crisis.

Norwegian central bank governor Svein Gjedrem said: "Activity in the Norwegian economy has picked up more rapidly than expected. Developments indicate that it is appropriate to raise the key policy rate now."

He added that rates would continue to rise "gradually".

Countries across the world have lowered interest rates over the past year to cut the cost of borrowing in at attempt to stimulate economic growth.



Print Sponsor


SEE ALSO
Australia raises interest rates
06 Oct 09 |  Business
Norway 'the best place to live'
05 Oct 09 |  Special Reports

RELATED INTERNET LINKS
The BBC is not responsible for the content of external internet sites


FEATURES, VIEWS, ANALYSIS
Has China's housing bubble burst?
How the world's oldest clove tree defied an empire
Why Royal Ballet principal Sergei Polunin quit

BBC iD

Sign in

BBC navigation

Copyright © 2016 BBC. The BBC is not responsible for the content of external sites. Read more.

This page is best viewed in an up-to-date web browser with style sheets (CSS) enabled. While you will be able to view the content of this page in your current browser, you will not be able to get the full visual experience. Please consider upgrading your browser software or enabling style sheets (CSS) if you are able to do so.

Americas Africa Europe Middle East South Asia Asia Pacific