Norway Cuts Rates to 0%, Warns of Worst Contraction Since WWII

The transcript discusses the economic impact of the COVID-19 pandemic on Norway, highlighting the role of Norges Bank in adjusting policy rates and intervening in currency markets. It explores Norway's economic resilience, supported by its sovereign wealth fund and oil production. The discussion also covers optimal oil prices for Norway's economy and the country's monetary and fiscal policy responses to the crisis.

What was the initial policy rate before Norges Bank reduced it to zero?

• 1.0%

• 0.5%

• 1.5%

• 2.0%

What action did Norges Bank take for the first time in 20 years during the pandemic?

• Intervened in the currency market

• Introduced new currency

• Stopped oil production

• Increased the policy rate

When did Norway discover oil in the North Sea?

• 1979

• 1959

• 1989

• 1969

What is the ideal oil price range for Norway according to the discussion?

• $40-$50

• $30-$40

• $60-$70

• $50-$60

What percentage of the sovereign wealth fund's capital is being used, exceeding the fiscal rule?

• 4%

• 3%

• 2%

• 5%

What is the main reason for the potential outflow from the sovereign wealth fund?

• New government policies

• Increased oil production

• Dramatic fall in economic activity

• High inflation rates

What is the expected future fiscal policy if the economy rebounds?

• More restrictive

• More expansive

• Remain the same

• Uncertain