The Norwegian central bank hints at raising interest rates, causing the Norwegian Krone to strengthen.

The Norwegian central bank kept its policy rate at 4% and indicated that the Norwegian krone may slightly widen its gains against the Euro after a possible rate hike at a future meeting. Governor Bakke of the Norwegian central bank stated that inflation has been above the 2% target for several years, and the outlook suggests that inflation will be higher than previously forecasted. She said that the uncertainty from the Middle East conflict has increased, but tightening policy is necessary to bring inflation back to the target level. The Norwegian central bank predicts that the interest rate will reach between 4.25% and 4.5% by the end of the year. The Euro was last reported at 11.1665 kroner, down 0.3% from 11.1769 kroner before the decision was announced.