Iceland's central bank cuts rates to tame currency
Posted by on Thu, May 18 2017 06:41 am
AFP, Reykjavik :
Iceland on Wednesday announced a quarter-point cut in interest rates to curb the growing strength of its national currency, buoyed by booming tourism, and to stimulate inflation.
The Central Bank of Iceland said interest rates would be lowered to 4.75 percent as it faces the dilemma of a strong economic growth and the rising Icelandic krona.
The stronger currency pushes down the prices of imported goods and exerts downward pressure on the overall inflation rate.
"The outlook is for a strong rise in gross domestic product (GDP) this year," the bank's Monetary Policy Committee said in a statement.
The central bank raised its full-year growth forecast for 2017 forecast by one full percentage point to 6.3 percent.
news:new nation/18-may-2017Iceland on Wednesday announced a quarter-point cut in interest rates to curb the growing strength of its national currency, buoyed by booming tourism, and to stimulate inflation.
The Central Bank of Iceland said interest rates would be lowered to 4.75 percent as it faces the dilemma of a strong economic growth and the rising Icelandic krona.
The stronger currency pushes down the prices of imported goods and exerts downward pressure on the overall inflation rate.
"The outlook is for a strong rise in gross domestic product (GDP) this year," the bank's Monetary Policy Committee said in a statement.
The central bank raised its full-year growth forecast for 2017 forecast by one full percentage point to 6.3 percent.
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- Iceland on Wednesday announced a quarter-point cut in interest rates to curb the growing strength of its national currency, buoyed by booming tourism, and to stimulate inflation.
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