Norway first EU country to raise interest rates

Norway has become the first European country to raise its interest rates since the financial crisis bit hard a year ago.

The country’s central bank increased the cost of borrowing to 1.5% from 1.25% in a widely-expected move.

It said the increase was needed to offset the hefty fiscal stimulus and because inflation is higher than expected while unemployment considerably lower than expected.

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tags: Economy, Financial Crisis, Norway