The Central Bank raised the policy interest rate to 9 per cent, a 0.25 per cent increase.
The increase came as a disappointment to Iceland’s prime minister, Halldor Asgrimsson, who said he had hoped an increase was not needed.
“I’m concerned this increase will make the krona too strong, and hurt the export industry.”
The Central Bank said the adjustment was necessary to fight inflation, which has caused housing prices to increase.
