Mubasher: Norway’s central bank raised its main interest rate for a second time in six months, while it indicated future tightening.

Norges Bank raised its deposit rate by 0.25% to 1%, as an “upturn in the Norwegian economy appears to be stronger than anticipated earlier.”

The bank’s decision bucked the more cautious global trend in which its peers moved to relax their monetary policies.

The Scandinavian country’s economy grew faster than a lot of its peers in the Eurozone and even neighbouring Sweden.

Meanwhile, the Swiss National Bank (SNB) decided to hold its rates.

“Our current assessment of the outlook and balance of risks suggests that the policy rate will most likely be increased further in the course of the next half-year,” the bank's governor Oystein Olsen said.

Last September, the Norwegian central bank raised its interest rate for the first time since 2011, after hitting a record low on the aftermath of the 2008 financial crisis and slumping energy prices.

In reaction to the announcement, the Norwegian krone (NOK) surged as much as 1.15 against the euro (EUR).

By 12:25 pm GMT, the USD/NOK pair dropped 0.65% to NOK 8.4454.