Norway’s underlying inflation slowed less than estimated in May as transport and housing costs rose.
The inflation rate, adjusted for taxes and energy prices, fell to 1.4 percent from 1.5 percent in April, Oslo-based Statistics Norway said today. Prices were estimated to rise 1.1 percent, according to the median forecast of eight economists in a Bloomberg survey. Underlying consumer prices rose 0.3 percent in the month.
Policy makers at Norges Bank left the benchmark interest rate unchanged at 1.5 percent last month and kept an outlook for rates to rise in about a year from now. Policy makers said they refrained from cutting rates again, in part as the krone had weakened since a record in February.
“I think we can say for sure that an interest rate cut is off the table,” Kari Due-Andresen, an economist at Svenska Handelsbanken AB (SHBA) in Oslo, said by telephone. While we expect Norges Bank “to lower the interest rate path, we don’t think it will be a very large downward revision.”
The krone, which emerged as a haven for investors seeking to evade Europe’s debt crisis, rose to a record on an import-weighted basis in February and has helped keep inflation below the bank’s 2.5 percent target since 2009. The krone has slid 3.1 percent since the February record.
The headline inflation rate was 2 percent in the year and consumer prices rose 0.1 percent in the month.
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