Monetary policy instruments
Norges Bank's most important instrument is the interest rate on banks' deposits with Norges Bank (sight deposit rate), also referred to as the key rate. The key rate influences short-term money market rates. The key rate and expectations concerning future developments in the key rate are decisive for banks' deposit and lending rates and for bond yields.
In addition to changing the key rate, Norges Bank can buy or sell NOK (intervene) in the foreign exchange market in order to influence the krone exchange rate. Norges Bank has the capacity to intervene in the foreign exchange market, but normally the Bank will not use interventions.