Denmark Raises Rates to Defend Krone as Haven Trade Fades

The Danish central bank raised its benchmark interest rates for the first time since July 2011 to defend the krone’s peg to the euro after investor appetite for the safest assets waned.

The Copenhagen-based bank raised the benchmark lending rate to 0.3 percent from a record-low 0.2 percent and increased the rate for certificates of deposit to minus 0.1 percent from minus 0.2 percent. The bank, which doesn’t hold scheduled meetings and adjusts interest rates to keep the krone close to a targeted 7.46038 rate against the euro, normally changes rates in tandem with the Frankfurt-based European Central Bank.