Finnbjörn Hermannsson, president of ASÍ, says it would be surprising if interest rates were not lowered.
mbl.is/Eggert Jóhannesson
The Icelandic Confederation of Labour (ASÍ) anticipates an interest rate cut on Wednesday, when the Central Bank of Iceland’s Monetary Policy Committee announces its decision.
Finnbjörn Hermannsson, president of ASÍ, says it would come as a surprise if rates were not lowered.
Cooling economy and rising unemployment
“We can expect them to lower the policy rate. We believe the time has come,” Hermannsson says, pointing to clear signs of weakness in the economy.
Would cause considerable concern
When asked, Hermannsson says that keeping rates unchanged would create significant anxiety.
“We would be worried about the situation. The economy is cooling, and we would be seriously concerned that we might be heading toward higher unemployment,” he says. Unemployment currently stands at about 3.9% nationwide.
The Monetary Policy Committee meets on Wednesday and will announce its rate decision.