“Recent developments in the Norwegian economy have been broadly in line with expectations.  Activity is rising moderately.  Inflation has slowed and is now below 2 per cent,” says Governor Svein Gjedrem.

Global economic growth has been slightly stronger than expected, but the level of activity is still low in advanced economies. Turbulence related to public finances in several European countries has receded, but the outlook for the US economy is somewhat more uncertain.

“Considerations relating to both inflation and stable developments in output and employment imply that the interest rate should be kept low. The consideration of guarding against the risk of future financial imbalances that may disturb activity and inflation somewhat further ahead suggests that the interest rate should be gradually brought closer to a more normal level,” says Gjedrem.

For further information, see The Executive Board’s monetary policy decision – background and general assessment.

• Charts and background material