{"id":72167,"date":"2026-09-24T04:08:10","date_gmt":"2026-09-24T08:08:10","guid":{"rendered":"https:\/\/www2.stockmarketwatch.com\/stock-market-news\/european-central-banks-diverge-norges-bank-hikes-as-riksbank-and-snb-hold-rates\/72167\/"},"modified":"2026-09-24T04:08:10","modified_gmt":"2026-09-24T08:08:10","slug":"european-central-banks-diverge-norges-bank-hikes-as-riksbank-and-snb-hold-rates","status":"publish","type":"post","link":"https:\/\/www2.stockmarketwatch.com\/stock-market-news\/european-central-banks-diverge-norges-bank-hikes-as-riksbank-and-snb-hold-rates\/72167\/","title":{"rendered":"European Central Banks Diverge: Norges Bank Hikes as Riksbank and SNB Hold Rates"},"content":{"rendered":"<h2>Key Takeaways<\/h2>\n<ul>\n<li><strong>Norges Bank raised its deposit rate by 25 basis points to 4.50%<\/strong>, signaling a tighter path for 2027 with key rate projections rising to <strong>4.60% by Q2 2027<\/strong>.<\/li>\n<li><strong>Sweden\u2019s Riksbank maintained its policy rate at 1.75%<\/strong> but issued a hawkish warning that rate hikes are likely to begin later this year to stabilize inflation toward its <strong>2% target<\/strong>.<\/li>\n<li><strong>The Swiss National Bank (SNB) held its interest rate steady at 0.00%<\/strong>, noting that current policy is appropriate despite slightly increasing mid-term inflationary pressure.<\/li>\n<li><strong>Bank of England Deputy Governor Lombardelli<\/strong> warned that policy may need to tighten further if elevated energy prices persist and wage growth remains inconsistent with inflation targets.<\/li>\n<li><strong>The US Dollar climbed to its highest level since May 2025 against the Swiss Franc<\/strong>, reaching <strong>0.8272<\/strong> following the SNB&#39;s decision and updated intervention language.<\/li>\n<\/ul>\n<h2>Divergent Paths for Nordic Central Banks<\/h2>\n<p><strong>Norges Bank<\/strong> took decisive action on Thursday, hiking its deposit rate by <strong>25 basis points to 4.50%<\/strong>. The move was largely expected by markets but accompanied by a hawkish shift in long-term projections. The central bank now sees the key rate reaching <strong>4.60% by the second quarter of 2027<\/strong>, up from previous estimates, as it battles persistent inflationary pressures.<\/p>\n<p>In contrast, the <strong>Swedish Riksbank<\/strong> elected to leave its policy rate unchanged at <strong>1.75%<\/strong>. However, the bank signaled that this pause may be short-lived, stating that the policy rate should be raised more than previously projected in June. If the economic outlook remains steady, the Riksbank expects to begin hiking rates before the end of this year to ensure inflation returns to the <strong>2% target<\/strong>.<\/p>\n<h2>SNB Maintains Neutral Stance Amid Currency Shifts<\/h2>\n<p>The <strong>Swiss National Bank (SNB)<\/strong> kept its benchmark interest rate at <strong>0.00%<\/strong>, meeting market expectations. While the bank raised its inflation forecasts slightly\u2014projecting <strong>0.8% for 2027 and 2028<\/strong>\u2014it maintained that current monetary conditions are appropriate for keeping inflation within the target range.<\/p>\n<p>A notable shift occurred in the SNB&#39;s communication regarding the foreign exchange market. The bank dropped the &quot;increased willingness&quot; wording from its FX statement, though it remains prepared to intervene if necessary. Following the announcement, the <strong>US Dollar<\/strong> surged <strong>0.24%<\/strong> against the Swiss Franc, hitting a multi-year high of <strong>0.8272<\/strong>.<\/p>\n<h2>BoE\u2019s Lombardelli Warns of Energy and Wage Risks<\/h2>\n<p>Bank of England Deputy Governor <strong>Lombardelli<\/strong> provided a cautious outlook on UK monetary policy, highlighting that <strong>wage growth remains too high<\/strong> to be consistent with long-term inflation targets. Lombardelli emphasized that while policy should not respond mechanically to energy prices, a sustained period of high energy costs could necessitate further tightening.<\/p>\n<p>The Deputy Governor noted that the &quot;interaction of the underlying economy&quot; and the nature of price transmission are the key factors determining future rate hikes. <em>Market participants are closely watching these comments as a sign that the BoE may remain more hawkish than its European peers if disinflationary evidence does not materialize.<\/em><\/p>\n<h2>Updated Economic Projections<\/h2>\n<p>The morning&#39;s central bank flurry included significant revisions to growth and inflation forecasts across the continent. The <strong>Riksbank<\/strong> upgraded its <strong>2026 GDP forecast to 2.8%<\/strong> (from 2.2%) but lowered its <strong>2028 outlook to 1.3%<\/strong>. Meanwhile, the <strong>SNB<\/strong> boosted its <strong>2026 Swiss GDP growth forecast to a range of 1.5-2%<\/strong>, up from the previous <strong>1.0%<\/strong> estimate.<\/p>\n<p><strong>Norges Bank<\/strong> adjusted its inflation outlook downward for the medium term, now seeing <strong>2026 CPI-ATE at 3%<\/strong> (down from 3.2%). Despite this lower near-term inflation path, the upward revision to interest rate projections suggests the central bank remains wary of &quot;sticky&quot; price levels and intends to keep policy restrictive for a longer duration.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Key Takeaways Norges Bank raised its deposit rate by 25 basis points to 4.50%, signaling a tighter path for 2027 [&hellip;]<\/p>\n","protected":false},"author":2,"featured_media":50383,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"site-sidebar-layout":"default","site-content-layout":"","ast-site-content-layout":"","site-content-style":"default","site-sidebar-style":"default","ast-global-header-display":"","ast-banner-title-visibility":"","ast-main-header-display":"","ast-hfb-above-header-display":"","ast-hfb-below-header-display":"","ast-hfb-mobile-header-display":"","site-post-title":"","ast-breadcrumbs-content":"","ast-featured-img":"","footer-sml-layout":"","theme-transparent-header-meta":"","adv-header-id-meta":"","stick-header-meta":"","header-above-stick-meta":"","header-main-stick-meta":"","header-below-stick-meta":"","astra-migrate-meta-layouts":"default","ast-page-background-enabled":"default","ast-page-background-meta":{"desktop":{"background-color":"var(--ast-global-color-5)","background-image":"","background-repeat":"repeat","background-position":"center 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