Iceland makes emergency hike as krona plummets

The Central Bank of Iceland raised rates by a massive 125 basis points to 15% on Tuesday 25 March, little over a fortnight before its next scheduled rate-setting meeting.

The central bank planned back in November last year to leave rates on hold until at least June. But the depreciation of the krona against the euro has led to higher-than-expected inflation, prompting the early hike.

The currency has depreciated by 33% against the euro from Ikr91.60 to Ikr121.54 since the start of 2008

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