As widely expected, NB left the sight deposit rate unchanged at today's monetary policy meeting. The statement was also very balanced referencing four factors that relative to September's on-hold message have developed in a dovish direction and four factors that have developed in a hawkish direction. The statement concluded that:
'Overall, developments since September do not differ substantially from the projections in the September Monetary Policy Report.'
No Monetary Policy Report (MPR) - and thereby rate path - was published today. The rate path therefore still suggests a 40% probability of a rate cut before next summer, but we interpret this as an 'insurance premium' against a weakening of data and/or a massive NOK appreciation. As we expect neither of the two, we expect NB to leave rates unchanged for the next 12M.
To read the entire report Please click on the pdf File Below