Icelandic central bank implements largest rate hike since 2008

The Central Bank of Iceland increased interest rates by 100 basis points after its monetary policy meeting today (May 4), and signalled it will have to further tighten financial conditions in the months ahead.

This is the largest rate increase the institution has implemented since 2008, taking the seven-day term deposit rate to 3.75%. The overnight loans rate is now at 5.5%, the seven-day collateralised loans rate at 4.5%, and the current account rate at 3.5%.

The policy rate is now at the