At least four parties will be required to form a majority government following Iceland’s election, so coalition negotiations are set to take a number of months. As the left-wing parties performed worse than expected, the most likely outcome appears to be another coalition with the Independence Party at the helm. This suggests that government policy will not be dramatically different to that before the election. So the results do not change our view that monetary policy will be kept unchanged until 2019.
Become a client to read more
This is premium content that requires an active Capital Economics subscription to view.
Already have an account?
You may already have access to this premium content as part of a paid subscription.
Sign in to read the content in full or get details of how you can access it
Register for free
Sign up for a free account to gain:
- Unlock additional content
- Register for Capital Economics events
- Receive email updates and economist-curated newsletters
- Request a free trial of our services