Norway: Economic activity remains resilient in second quarter
August 23, 2012
In the second quarter, Norway mainland's GDP - which consists of all domestic production activity except for extraction of crude oil and natural gas (including related services), pipeline and ocean transport - rose a seasonally adjusted 1.0% over the previous quarter. The print came in below the 1.2% expansion recorded in the first quarter (previously reported: +1.1% quarter-on-quarter) but was in line with market expectations. Compared to the same period last year, the mainland economy grew 3.7%, which is down from the 4.9% increase tallied in the previous quarter. Meanwhile, total GDP expanded a seasonally adjusted 1.2% over the previous quarter, which was below the 1.5% increase recorded in the first quarter (previously reported: +1.4% qoq). On an annual basis, total GDP accelerated to 5.0% in the second quarter, up from the 4.6% rise recorded in the first and marking, in fact, the strongest expansion seen since Q2 2002. According to the statistical institute, total GDP benefited from strong growth in petroleum activities, while added value in ocean transport deteriorated. The slight deceleration over the previous quarter was due to a slowdown in the external sector, while domestic demand improved (Q1: +0.1% qoq; Q2: +0.7% qoq). Private consumption increased 1.0% over the previous quarter (Q1: +1.1% qoq), while government spending rebounded to a 1.0% expansion (Q1: -0.3% qoq). In addition, gross fixed capital investment rose 2.7%, contrasting the 0.2% drop tallied in the previous quarter. On the external side of the economy, exports of goods and services rose a seasonally adjusted 1.3% over the previous three-month period (Q1: +2.0% qoq). On the other hand, imports contracted a mild 0.1%, an improvement compared to the 2.1% decline observed in the previous quarter. As a result, the external sector's net contribution to overall growth deteriorated from 1.5 percentage points in the first quarter to 0.5 percentage points in the second.
Author: Ricardo Aceves, Senior Economist