The Central Bank of Iceland’s key interest rates will remain unchanged at 9.25%, according to the decision of the Bank’s Monetary Policy Committee. Inflation has increased since the last policy rate decision.
The Central Bank announced this morning that the key interest rates would remain unchanged for the time being. The key interest rates have now been 9.25% for a whole year. In the bank’s announcement regarding the decision, it is stated that underlying inflation is still high, price increases have occurred broadly, and the housing component weighs heavily. Although domestic demand has slowed down recently, there is still tension in society and there has been little decrease since the meeting of the Monetary Policy Committee in May.
The outlook is therefore that it may take some time to achieve an acceptable reduction in inflation, and therefore the current rates are reasonable.