Norway cuts rates in surprise move as economy ails

Norway's central bank cut interest rates in a surprise move on Thursday to prop up an economy ailing from falling offshore investments, lower oil prices and weak growth in Europe.

The Norwegian krone fell to a 5-year low against the euro following the news.

The central bank cuts its benchmark rate to 1.25 percent from 1.5 percent, defying analysts expectations for a steady rate and a promise of lower rates next year.

"Growth prospects for the Norwegian economy have weakened," the bank said in a statement. Activity in the petroleum industry is softening and the sharp fall in oil prices is likely to amplify this tendency."