Norway GDP

Norway

Norway: Total GDP rebounds in Q1 on improving oil activities

May 20, 2014

In Q1, total GDP rose a seasonally-adjusted 0.3% over the previous period, which contrasted the 0.2% decline tallied in Q4. The print, nevertheless, undershot the 1.0% expansion market analysts had expected. According to the statistical institute, total GDP benefited from a softer contraction in petroleum activities and in ocean transport, which declined 0.2% over the previous quarter (Q4: -2.6% quarter-on-quarter). On an annual basis, total GDP growth jumped from 1.2% in Q4 to 4.0% in Q1, which marked the highest reading since Q2 2012.

Mainland Norway’s 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 0.5% over the previous quarter in Q1. The reading matched both the result tallied in the previous period and market expectations. Compared to the same period of the previous year, the mainland economy expanded 3.7% in Q1, which more than doubled the 1.8% increase tallied in Q4.

Private consumption accelerated to a 0.8% increase in Q1 (Q4: +0.3% qoq), while government spending expanded 0.9% (Q4: +0.5% yoy). Gross fixed investment recorded the largest fall since Q2 2011, declining 1.8% over the previous quarter (Q4: -0.5% qoq).

Exports of goods and services rebounded in Q1, expanding 1.6% in seasonally-adjusted terms over the previous quarter (Q4: -2.7% qoq), while imports contracted 2.6% (Q4: -1.3% qoq). As a result, the external sector’s net contribution to overall growth swung from minus 0.7 percentage points in Q4 to plus 1.4 percentage points in Q1.

The Central Bank expects total GDP to rise 1.5% in 2014 and 2.0% in 2015. FocusEconomics Consensus Forecast panelists see total GDP increasing 1.8% in 2014, which is down 0.1 percentage points from last month’s estimate. For 2015, the panel expects the economy to expand 2.1%. Meanwhile, the Bank sees Mainland GDP expanding 1.8% in 2014 and 2.5% in 2015. FocusEconomics Consensus Forecast panelists expect Mainland GDP to increase 2.1% in 2014, which is up 0.1 percentage points from last month’s projection. In 2015, panelists see Mainland GDP growth rising to 2.3%.


Author: Ricard Torné, Head of Economic Research

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Norway GDP Q1 2014 1

Note: Quarter-on-quarter changes of seasonally adjusted GDP and year-on-year variation in %.
Source: Statistics Norway (SN) and FocusEconomics Consensus Forecast.


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