Iceland’s Central Bank raised its key interest by 75bps to 4.75% on August 24, 2022, an eighth consecutive increase in borrowing costs which now stand at their highest level since mid-2016. The Monetary Policy Committee also signaled further tightening in the future in order to tame inflation, which in the island state already advanced to 9.9%in July, and is forecast to peak at nearly 11% late this year, well above the 2.5% target. Meanwhile, policymakers see GDP growth of nearly 6% in 2022, some 1.3 percentage points above the May forecast, mainly due to more robust private consumption growth and a more rapid rebound in tourism than previously projected. source: Central Bank of Iceland

Interest Rate in Iceland averaged 6.63 percent from 1998 until 2022, reaching an all time high of 18 percent in October of 2008 and a record low of 0.75 percent in November of 2020. This page provides - Iceland Interest Rate - actual values, historical data, forecast, chart, statistics, economic calendar and news. Iceland Interest Rate - data, historical chart, forecasts and calendar of releases - was last updated on October of 2022.

Interest Rate in Iceland is expected to be 5.50 percent by the end of this quarter, according to Trading Economics global macro models and analysts expectations. In the long-term, the Iceland Interest Rate is projected to trend around 5.00 percent in 2023 and 4.00 percent in 2024, according to our econometric models.

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Iceland Interest Rate



Calendar GMT Actual Previous Consensus TEForecast
2022-05-04 08:30 AM CBI Interest Rate Decision 3.75% 2.75% 3%
2022-06-22 08:30 AM CBI Interest Rate Decision 4.75% 3.75% 4.5%
2022-08-24 08:30 AM CBI Interest Rate Decision 5.5% 4.75% 5.75%
2022-10-05 08:30 AM CBI Interest Rate Decision 5.5% 6.25%
2022-11-23 08:30 AM CBI Interest Rate Decision
2022-11-23 09:00 AM Monetary Bulletin


Related Last Previous Unit Reference
Interest Rate 5.50 5.50 percent Sep 2022
Interbank Rate 6.05 6.05 percent Oct 2022
Money Supply M1 831.27 813.36 ISK Billion Jun 2022
Money Supply M0 152.84 139.54 ISK Billion Jun 2022
Money Supply M2 1740.76 1721.55 ISK Billion Jun 2022
Money Supply M3 2452.95 2447.22 ISK Billion Jun 2022
Foreign Exchange Reserves 897864.81 878646.55 ISK Million Aug 2022
Banks Balance Sheet 4798908.00 4803778.00 ISK Million Jun 2022
Central Bank Balance Sheet 924885.00 919805.00 ISK Million Jul 2022

Iceland Interest Rate
In Iceland, the benchmark interest rate is set by the board of Governors of the Central Bank of Iceland (Seðlabanki Íslands). The main interest rate is the seven-day term deposit rate since May 2014. Previously the Bank’s key rate was the rate on its collateralised loans to financial institutions, but in the wake of the crisis the interest rate on the Bank’s deposits had greater influence on money market, as demand for Central Bank loans had been limited. Therefore the Bank’s key interest rate is the rate on seven-day term deposits.
Actual Previous Highest Lowest Dates Unit Frequency
5.50 5.50 18.00 0.75 1998 - 2022 percent Daily

News Stream
Iceland Hikes Interest Rate by 75bps to 5.50%
Iceland’s Central Bank raised its key interest by 75bps to 4.75% on August 24, 2022, an eighth consecutive increase in borrowing costs which now stand at their highest level since mid-2016. The Monetary Policy Committee also signaled further tightening in the future in order to tame inflation, which in the island state already advanced to 9.9%in July, and is forecast to peak at nearly 11% late this year, well above the 2.5% target. Meanwhile, policymakers see GDP growth of nearly 6% in 2022, some 1.3 percentage points above the May forecast, mainly due to more robust private consumption growth and a more rapid rebound in tourism than previously projected.
2022-08-24
Iceland Hikes Interest Rate by 100bps to 4.75%
The Central Bank of Iceland raised its key interest by 100bps to 4.75% on June 22, 2022, marking a sixth consecutive increase in borrowing costs, and signaled further rate hikes in the coming meetings. The Monetary Policy Committee based its decision on efforts to curb accelerating consumer prices, lifted by energy prices globally and housing prices domestically. The annual inflation rate in Iceland accelerated to 7.6% in April, the highest since 2010 and well above the central bank’s target of 2.5%. The MPC also noted that growth during Q1 was stronger than expected, while economic activity and the job market are forecasted to remain strong, justifying the rate hike. The Icelandic economy grew 1.1% quarter-on-quarter and 8.6% year-on-year in Q1.
2022-06-22
Iceland Hikes Interest Rate by 100bps to 3.75%
The Central Bank of Iceland raised its key interest rate by 100bps to 3.75% on May 4th, 2022, a fifth consecutive increase in borrowing costs, and signaled further rate hikes in the coming meetings. The Monetary Policy Committee based its decision on efforts to curb accelerating consumer prices, lifted by energy prices globally and housing prices domestically. The annual inflation rate in Iceland accelerated to 7.2% in April, the highest since 2010 and well above the central bank’s target of 2.5%. Due to the war in Ukraine, the MPC upwardly revised inflation forecasts to above 8% in the third quarter of 2022 and said it does not expect inflation to fall below 3% until 2024. The committee also downwardly revised GDP growth estimates to 4.6% for 2022 and 2.6% for 2023, compared to 4.8% and 2.1%, respectively.
2022-05-04