Sparebank 1 SR-Bank has developed a chatbot that predicts three interest rate cuts in 2024. Norges Bank disagrees – NRK Rogaland – Local news, TV and radio

In the last two years, experts and chief economists have mostly missed the interest rate forecasts.

Now Artificial Intelligence (AI) is at full speed into the financial world. Banks are starting to use chatbots that both provide forecasts and analyse.

Such as Sparebank 1 SR-Bank in Stavanger.

They have called the robot SR-GPT. The bank’s own ChatGPTtherefore.

The bank challenged the robot on how many interest rate cuts it thought would happen before the new year.

They gave the robot assumptions that the target was inflation of around 2 percent and low unemployment, as well as that the interest rate peak had been reached and that an interest rate peak normally lasts for six and a half months.

In addition, they informed the robot that both the US and Europe will begin their interest rate cuts this summer.

Tracks three interest rate cuts

Then came the answer:

Today, the interest rate is 4.5 percent. In March, Norges Bank chose to keep interest rates unchanged. The central bank envisages that the first interest rate cut will come in September. The next interest rate meeting is in May.

The interest rate in question here is the policy interest rate in Norway. Norges Bank manages this:

– Seems reasonable

– I think the forecasts seem reasonable and not too far off from what I think. It is admittedly a little more optimistic than me and much more optimistic than Norges Bank, says Kyrre M. Knudsen, chief economist at SR-Bank.

The robot therefore believes in three interest rate cuts before the New Year. Knudsen and SR-Bank believe in two interest rate cuts, while Norges Bank believes in between one and two.

– I have missed a lot in the last two years, just like all other experts and Norges Bank. Mpeople have not been able to accept the new situation, with a pandemic and war, says chief economist Knudsen.

The man behind the chatbot is called Charl Maree. He believes that all chief economists must learn AI as soon as possible.

– JI believe that someone who knows AI will take both Knudsen’s job and also set the interest rates in Norway going forward. The robots are unlikely to set the policy interest rate in Norway, but it will certainly come up with proposals, says the AI ​​expert.

– Not likely

Kjersti Haugland is chief economist at DNB. She herself predicts two interest rate cuts this year.

– It does not seem likely with three cuts. If I’m wrong with my two cuts, I rather think we’ll get fewer interest rate cuts than more, says Haugland.

She has more faith in economists than this robot.

– Three interest rate cuts can of course happen, but it is clearly more likely that we will get two, one or none, she says.

The chief economist says DNB does not have a similar chatbot as SR-Bank.

– AI can change the way analysts work. It certainly has the potential, but we are not there yet, she says.

She herself uses ChatGPT, but not for analytical purposes.

Another person who does not agree with the chatbot is chief economist Marius Gonsholt Hov at Handelsbanken.

He believes we will only see one interest rate cut this year, meaning that the interest rate will be 4.25 per cent by the end of 2024.