Norway: Economic growth slows in Q3
November 20, 2014
In Q3, total GDP increased a seasonally-adjusted 0.5% over the previous quarter, which is less than half the revised 1.1% expansion tallied in Q2 (previously reported: +0.9% quarter-on-quarter). The reading matched market expectations. According to the statistical office, Q3’s deceleration reflected a deterioration in the production and distribution of electricity which was compensated by a notable improvement in the extraction of crude oil and natural gas. Compared to the same quarter last year, GDP accelerated from a revised flat growth in Q2 (previously reported: -0.3% year-on-year) to a 2.1% expansion in Q3.
Mainland GDP—consisting of all domestic production activity except for the extraction of crude oil and natural gas (including related services), pipeline and ocean transport—rose a seasonally-adjusted 0.4% in Q3. The reading came in well below the 1.2% increase observed in Q2. The expansion, nonetheless, exceeded the 0.2% rise the market had expected. Compared to the same period last year, the mainland economy accelerated from a revised 1.0% increase in Q2 (previously reported: +0.8% yoy) to a 2.7% rise in Q3.
Domestic demand slowed notably over the previous quarter, reflecting a deceleration in government consumption (Q3: +0.6% qoq; Q2: +1.0% qoq) and a deterioration in private spending (Q3: -0.1% qoq; Q2: +0.7% qoq). In addition, fixed investment swung from a 0.3% increase in Q2 to a 0.2% contraction in Q3.
Conversely, the external sector improved, as exports of goods and services expanded a solid 2.1% over the previous quarter, which contrasted the 1.4% contraction tallied in Q2. Imports grew 2.2% in Q3, which contrasted the 0.3% decrease tallied in Q2. Consequently, the contribution from net exports to overall economic growth swung from minus 0.4 percentage points in Q2 to plus 0.2 percentage points in Q3.