(Adds analysts in paragraphs 7-8, 14-15, inflation, wage forecasts in 12th paragraph, updates currency)
By Terje Solsvik
OSLO, Sept 21 (Reuters) - Norway's central bank raised its benchmark interest rate by 25 basis points (bps) to 4.25% on Thursday to curb inflation, as widely predicted, and, in a surprise move, said it would probably hike again in December.
All 30 economists polled in advance by Reuters expected a 25-basis-point hike on Thursday, and a majority of participants had predicted that this would mark the peak of Norges Bank's two-year campaign of tightening.
"There will likely be one additional policy rate hike, most probably in December," Governor Ida Wolden Bache said in a statement.
The policy rate was forecast to stay around 4.50% through 2024, the central bank added.
Only five economists in the Reuters poll had expected rates to hit 4.50% this year.
But a December hike is not a certainty and will depend on how economic conditions develop, Norges Bank said.
Based on the central bank's own forecast, analysts at Handelsbanken estimated the likelihood of a December rate rise to be between 70% and 80%.
"Unless we see a sharper deterioration in key economic data, or a sharper downtrend in inflation, Norges Bank is aiming for yet another hike by the end of this year," Handelsbanken analysts said in a note.
The crown strengthened to 11.49 against the euro at 0935 GMT, from 11.52 just before the 0800 GMT announcement.
Norway's annual core inflation, which excludes energy costs, stood at 6.3% in August, down from a June peak of 7.0%, and has remained above the bank's 2% target since February 2022.
In 2024, core inflation is now expected to decline to 4.7%, Norges Bank said, up from a forecast of 4.6% made in June.
But the headline inflation outlook for next year was lifted to 4.8% from 3.9%, while the expectation for wage increases was lifted to 5.2% from 4.7%, Norges Bank said.
"The outcome of this meeting was clearly on the hawkish side. Higher wage growth and higher inflation for longer are the key reasons behind the upward adjustment to the rate path," analysts at Nordea Markets said in a note.
The latest inflation estimate may turn out to be exaggerated, however, so that "another hike from Norges Bank is therefore not cut in stone even if the central bank says it is highly probable", Nordea added.
Although weak by historical standards, the Norwegian crown has strengthened since June on a trade-weighted basis by about 6% against a broad basket of currencies.
Sweden's Riksbank earlier on Thursday raised rates by 25 basis points to 4.0% and said it expected to hike again, while the Swiss National Bank kept rates on hold but kept the door open to potential future tightening of policy.
The U.S. Federal Reserve held its benchmark overnight interest rate steady on Wednesday and stiffened a hawkish monetary policy stance that could lead to another hike later this year.
The European Central Bank raised its key interest rate last week to a record high of 4%, signalling that was likely to be its final hike in a 14-month-long fight against inflation.
The Bank of England is expected to announce later on Thursday what could be its last rate hike of this cycle. (Reporting by Terje Solsvik, Editing by Gwladys Fouche, Bernadette Baum and Catherine Evans)