Norway unlikely to cut interest rates

Despite being a remarkable 4.5 percent above the US and 3.25 percent above Europe's interest rates, leading Norwegian macro-economists see no pressure on Norway's central bank to follow suit. "If this interest cut is what is needed to get the world economy going, it will reduce the likelihood for an interest cut in Norway," says senior analyst Erik Bruce of Nordea Markets. Harald Magnus Andreassen, chief economist of First Securities, agrees. "We have been saying all along that a cut in Norwegian interest rates will come next year at the earliest. I think that Norway's central bank has time to wait and see how it goes with the global economy before making a cut," Andreassen said. Central Bank boss Svein Gjedrem will call the next interest rate meeting at the end of the month. Norway's economic climate is not in sync with the situation in the USA or European Union and there has not been a noticeable effect after the terrorist attacks in America.