Iceland interest rate
Central Bank of Iceland
- Policy rate
- 8.00%
- Sep 22, 2026
- Last move
- +0.25 pt
- Aug 2026
- Inflation
- 5.6%
- Aug 2026
- 10-year bond yield
- 2.93%
- Aug 2026
The policy rate set by the Central Bank of Iceland is 8.00% as of Sep 22, 2026. Its most recent move: it raised its rate from 7.75% to 8.00% (Aug 2026). The rate is 0.50 percentage points higher than a year earlier. With consumer prices up 5.6% over the 12 months to Aug 2026, the real rate (policy rate minus inflation) is +2.4%: borrowing costs are above inflation.
Policy rate over the past two years
Sep 22, 2026: 8.00%
Rate changes
| When | Decision | From | To | Change |
|---|---|---|---|---|
| Aug 2026 | Hike | 7.75% | 8.00% | +0.25 pt |
| May 2026 | Hike | 7.50% | 7.75% | +0.25 pt |
| Mar 2026 | Hike | 7.25% | 7.50% | +0.25 pt |
| Nov 2025 | Cut | 7.50% | 7.25% | −0.25 pt |
| May 2025 | Cut | 7.75% | 7.50% | −0.25 pt |
| Mar 2025 | Cut | 8.00% | 7.75% | −0.25 pt |
| Feb 2025 | Cut | 8.50% | 8.00% | −0.50 pt |
| Nov 2024 | Cut | 9.00% | 8.50% | −0.50 pt |
| Oct 2024 | Cut | 9.25% | 9.00% | −0.25 pt |
Changes between month-end rates, plus the latest daily reading. Two decisions in one month show up as a single change.
Inflation (% vs a year earlier)
Aug 2026: 5.6%
10-year government bond yield
Aug 2026: 2.93%
Other central banks in Europe
Source: BIS; inflation: IMF CPI; bond yield: IMF monetary statistics. Updated daily. All central bank rates · Iceland economy dashboard