Bank of Iceland

Bank of Iceland’s August Policy Review

August 23, 2017

The 7-day deposit rate, which had been cut by 50 basis point sin August 2016 and by 25 bps each in May and June of this year, was left at 4.5% after the latest meeting of the monetary policy committee. A released statement revealed that projected GDP growth in 2017 was revised marginally lower but […] More

Trump Fuels Public Angst Again

August 23, 2017

In vintage style, the U.S. president’s comments at a political rally in Phoenix was full of threats and accusations on a range of topics: a possible government shutdown if Congress doesn’t fund his “wall” proposal; blaming a few Republicans for the vote against repealing Obamacare; accusing the media for distorting his response to Charlottesville and […] More

Bank of Iceland

June 1, 2016

Icelandic monetary policy has been in a tightening cycle since an initial increase in the seven-day collateralized lending rate of 50 basis points in June 2015.  That move was followed by two 25-basis point hikes in August and November.  But officials managed to put off a fourth increase in the first half of 2016, which […] More

Bank of Iceland Creates Some Surprise, Leaving Interest Rates Unchanged

December 9, 2015

Sedlabanki’s 7-day collateralized lending rate had earlier been increased this year by 50 basis points each in June and August as well as 25 bps last month to 6.5%.  Underlying inflation is expected to rise, but policymakers lately believe that inflation in the near term will be lower than imagined before because of a firmer krona […] More

Benign Data and Market Action

August 19, 2015

The dollar did not change on balance overnight against the euro or sterling.  Other changes were mute, too, including a 0.1% uptick versus the yen. Share prices are mostly softer.  Ten-year sovereign debt yields are unchanged in the U.S., Germany, Japan and Britain. WTI oil slipped 0.8% to $42.30 per barrel.  Comex gold firmed 0.4% […] More

Bank of Iceland to Raise Interest Rates Before Long

May 13, 2015

Although the 7-day Icelandic repo rate of 4.5% was left unchanged, officials signaled that a hike is coming. “The Bank’s interest rate reduction late in 2014 was based on a sharp drop in inflation and the decline in inflation expectations, which led to a larger rise in real rates than was considered warranted at that […] More

Bank of Iceland: No Rate Change

March 18, 2015

Iceland’s 4.5% seven-day term deposit rate, 5.25% seven-day collateralized lending rate, and 6.25% overnight lending rate were left unchanged after the latest review by the Monetary Policy Committee, which released a very similar statement to the prior one on February 4.  Officials are treating the recent slide of inflation cautiously. Inflation has measured 0.8% in […] More

Bank of Iceland Cuts Interest Rate

November 5, 2014

Iceland’s one-week central bank lending rate was changed today for the first time in two years.  A cut of 25 basis points to 5.75% reversed a similar-sized increase in November 2012 that culminated 175 basis points of tightening begun in August 2011.  The explanation in a released statement focused on lower inflation and indications of […] More

Bank of Iceland

October 1, 2014

The seven-day Icelandic collateralized lending rate was left unchanged as expected at 6.0%, its level since a 25-basis point hike in November 2012 culminated 175 basis points of tightening begun in August 2011.  A statement from the Monetary Policy Committee observes that economic growth slowed in the first half of 2014 but remains consistent with […] More