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Erik Johannes Bruce, analyst at Nordea Markets, suggests that they are forecasting Norway’s mainland GDP to grow at 0.3% q/q (2.3% y/y) down from 0.9% in Q4 while the Norges Bank’s forecast is 0.6%.

Key Quotes

“We forecast a significant slowdown in Q1 compared to Q2. But the Q4 figure was pulled up by a rebound in agricultural production and our forecast for Q1 is dragged down 0.3% points by lower electricity production. A temporary effect of a warm winter. On average, growth in Q4 and Q1 will be about 0.6% q/q. Close to the level we saw through 2018. In other words, if we are right the figure should not be taken as a sign of a slowdown.”

“Our forecast is well below Norges Banks, but it indicated clearly on the May meeting that it to some degree will see through lower than expected GDP driven by electricity production.”

“The demand picture will also be important for the view on the economy and especially the private consumption.”

“All in all, if our forecast turns out right it should do little to change the view on Norges Bank. Norges Bank will probably give little weight to growth on the weak side to forecast. Especially if employment growth is somewhat on the strong side.”