Financial News: Iceland Keeps Key Rates Unchanged

Iceland Keeps Key Rates Unchanged

10/08/2025 - 07:53:00 (RTTNews)

(RTTNews) - Iceland's central bank left its interest rate unchanged, on Wednesday, as policymakers assessed that conditions for further easing have not yet emerged.

The Monetary Policy Committee of the Central Bank of Iceland, led by Governor Ásgeir Jónsson, unanimously decided to hold the seven-day term deposits rate at 7.50 percent.

Policymakers observed that the conditions that would enable an easing of interest rates have not yet emerged. The bank said any further cuts will depend on whether inflation moves closer to the bank's target of 2.5 percent.

"As before, near-term monetary policy formulation will be determined by developments in economic activity, inflation, and inflation expectations," the bank said.

Inflation rose to 4.1 percent in September due to unfavorable base effects. At the same time, the economy remains fairly resilient but wage rises are sizeable. Although inflation expectations subsided in the recent past, it remains above target, bank noted.

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