Norway Economic Outlook
October 25, 2016Robust private consumption due to an accommodative monetary policy and fiscal policy support propelled mainland growth in Q2. This positive news, however, was offset by a renewed drop in oil-related output and investment as low oil prices continue to dampen activity in the all-important sector. August’s drop in industrial production confirms the fragility of Norway’s economic growth. On 6 October, the government presented the 2017 budget and stated that it will use around 3.0% of Norway’s USD 880 billion sovereign wealth fund, which is below the 4.0% fiscal rule limit. The expansionary budget promises to shore up growth next year. In an attempt to boost its returns in a context of low government bond yields, the fund will increase its allocation to equities from 60% to 70%. Norway’s massive oil fund owns, on average, 1.3% of all globally listed equities.
Norway Economy Data
5 years of Norway economic forecasts for more than 30 economic indicators.
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|Bond Yield||1.35||4.72 %||Oct 26|
|Exchange Rate||8.28||-0.06 %||Oct 26|
|Stock Market||633||-1.93 %||Oct 26|
Norway Economic Growth
October 25, 2016Low oil prices are translating into high unemployment and weak investment, which are keeping overall growth subdued. GDP is expected to expand 1.0% in 2016, which is up 0.1 percentage points from last month’s forecast. In 2017, our panel sees the economy growing 1.4%. Mainland GDP, which excludes oil drilling activities, is expected to expand 0.9% in 2016, which is unchanged from last month’s forecast. The panel expects it to increase to 1.8% in 2017.
Norway Economic News
October 10, 2016
In September, consumer prices climbed 0.3% from the previous month, which contrasted August’s reading (-0.5% month-on-month) but undershot market expectations of a 0.7% increase.
October 7, 2016
In August, industrial production decreased 4.7% over the previous month in seasonally-adjusted terms, which contrasted the 4.7% expansion recorded in July and marked the lowest reading since April 2015.
September 22, 2016
At its 21 September policy meeting, Norges Bank (NB) decided to leave its key policy rate at the all-time low of 0.50%, as was expected by market participants. Norges Bank noted that global growth was moderate and that in the medium term import demand from its main trading partners will be lower than previously expected.
September 9, 2016
In August, consumer prices dropped 0.5% over the previous month, which contrasted July’s reading (+0.6% month-on-month) and undershot market expectations of a 0.4% drop.
September 7, 2016
In July, industrial production expanded 5.5% over the previous month in seasonally-adjusted terms, which marked a rebound from the 4.7% fall recorded in June and represented the highest reading since October 2012.