Calculation of the Aggregate for Trading Partner Interest Rates

Foreign interest rates influence interest rates in Norway, partly via the effect of interest rate differentials on movements in the krone exchange rate. Movements in the krone exchange rate will, in turn, influence inflation and economic activity in Norway. Norges Bank’s monetary policy analysis uses an aggregate for trading partner interest rates as a representation of foreign interest rates. As from Monetary Policy Report 2/15, the composition of this aggregate for trading partner interest rates has been revised somewhat. This paper explains the current calculation method for this aggregate and the changes from the earlier method.1publishedVersio