Norges Bank Says Interest Rate Cut Possible, Krone Drops

The Norwegian krone sank today after the nation’s central bank left its monetary policy unchanged at today’s meeting but said that an interest rate cut is possible in case the economy worsens significantly.
The Norges Bank left its main interest rate at 1.5 percent today. As for the interest rate outlook, the central bank said:

There are prospects that the key policy rate will remain at about today’s level to the end of 2015, followed by a gradual rise.

At the same time, the bank did not count out possibility of lower rates:

A further weakening of the outlook for the Norwegian economy may warrant a reduction in the key policy rate.

USD/NOK went up from 6.0085 to 6.1249 as of 15:42 GMT today.

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