Iceland: Sedlabanki on hold as expected
Just as expected, the Icelandic central bank, Sedlabanki, has announced that it has kept its key policy rate unchanged at 13.75%. With inflation still running well above Sedlabanki’s inflation target of 2½% +/- 1 percentage point Sedlabanki had no choice but to keep interest rates on hold. Furthermore, the fact that the Icelandic kronur has weakened significantly recently is clearly increasing inflationary pressures.
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