THE EXECUTIVE BOARD 11 MAY 2016

(1)

THE EXECUTIVE BOARD

11 MAY 2016

(2)

International economy: GDP for trading partners

2

Annual change. Percent. Export weights. 2005 – 2016

¹⁾

-6 -4 -2 0 2 4 6 8 10 12

2005 2007 2009 2011 2013 2015

Emerging economies Advanced economies Trading partners

1) Projections for 2016 (broken lines).

Sources: Thomson Reuters and Norges Bank

(3)

International economy: GDP

Seasonally adjusted volume index. 2008 Q1 = 100. 2008 Q1 – 2016 Q1

90 95 100 105 110 115

2008 2010 2012 2014 2016

US

Sweden (to 2015 Q4) Euro area

UK

(4)

International economy: Inflation

Twelve-month change. Percent. January 2010 – March 2016

-2 -1 0 1 2 3 4 5 6 7 8

2010 2012 2014 2016

Trading partners Advanced economies Emerging economies

Sources: Datastream and Norges Bank 4

(5)

Policy rates and estimated forward rates ¹⁾

Percent. January 2012 – December 2019

-1 0 1 2 3

2012 2014 2016 2018

US

Euro area UK

Sweden 9 May 2016 11 March 2016

1) Broken lines show estimated forward rates at 11 March 2016. Solid lines show forward rates at 9 May 2016. Forward rates are based on Overnight Index Swap (OIS) rates.

MPR 1/16

(6)

Forward money market rates for trading partners ¹⁾

6

Percent. September 2016 – December 2019

-0.5 0 0.5 1 1.5

Sep-16 Jun-17 Mar-18 Dec-18 Sep-19

Change 9 May 2016 11 March 2016

1) Broken line shows forward rates from MPR 1/16. Solid line shows forward rates at 9 May 2016.

Sources: Thomson Reuters and Norges Bank

MPR 1/16

(7)

Yields on 10-year government bonds

Percent. 1 January 2014 – 9 May 2016

0 0.5 1 1.5 2 2.5 3 3.5 4 4.5 5

Jan-14 Apr-14 Jul-14 Oct-14 Jan-15 Apr-15 Jul-15 Oct-15 Jan-16 Apr-16

US Germany UK Italy MPR 1/16

(8)

CDS indices for European financial sector

8

0 50 100 150 200 250 300 350

Jan-14 Jul-14 Jan-15 Jul-15 Jan-16

Senior financials Subordinated bonds

Source: Bloomberg

Basis points. 1 January 2014 – 9 May 2016

MPR 1/16

(9)

Selected equity price indices

Index. January 2014 = 100. 1 January 2014 – 9 May 2016

50 75 100 125 150 175 200 225 250

Jan-14 Jul-14 Jan-15 Jul-15 Jan-16

Emerging economies US

Europe China

MPR1/16

(10)

Exchange rate (I-44) ¹⁾ and oil price

10

Oil price (Brent Blend, first contract, USD per barrel) and import- weighted exchange rate index. 1 January 2012 – 9 May 2016

20 40 60 80 100 120 140 80

90

100

110 Jan-12 Jul-12 Jan-13 Jul-13 Jan-14 Jul-14 Jan-15 Jul-15 Jan-16

I-44 (left-hand scale, inverted) Average I-44, Q2

Projection I-44, MPR 1/16 Oil price (right-hand scale)

MPR 1/16

1) A positive slope denotes stronger krone exchange rate.

Sources: Norges Bank and Bloomberg

(11)

Three-month Nibor spread

Percentage points. 1 January 2012 – 9 May 2016.

Projections 2016 Q2 – 2017 Q1

0 0.2 0.4 0.6 0.8 1 1.2

2012 2013 2014 2015 2016 2017

Three-month Nibor spread Projections MPR 1/16

MPR 1/16

(12)

Risk premiums on bank bonds

12

Basis points above three-month Nibor. Monthly figures.

January 2008 – April 2016

-50 0 50 100 150 200

2008 2009 2010 2011 2012 2013 2014 2015 2016

Risk premiums, new bank bonds Risk premiums, new covered bonds Risk premiums, bank bonds outstanding Risk premiums, covered bonds outstanding

Sources: Stamdata, Bloomberg, DNB Markets and Norges Bank

MPR 1/16

(13)

2007 Q4 – 2016 Q1

-80 -60 -40 -20 0 20 40 60 80

2008 2010 2012 2014 2016

Change in credit demand past quarter Change in credit standards past quarter

Next quarter Next quarter

Norges Bank’s survey of bank lending – non-financial

enterprises

(14)

Twelve-month change. Percent. January – March 2016

Sources: Statistics Norway and Norges Bank

0 2 4 6 8 10

2012 2013 2014 2015 2016

Credit to Norwegian non-financial enterprises in mainland Norway (C2)

14

(15)

Credit to Norwegian non-financial enterprises (C3)

Twelve-month change. Percent. January 2003 – March 2016

-20 -10 0 10 20 30 40 50

2003 2005 2007 2009 2011 2013 2015

Domestic notes and bonds

Domestic credit from banks and mortgage companies Foreign credit (mainland enterprises) (to February)

(16)

Twelve-month change. Percent. January 2012 – March 2016

Sources: Statistics Norway and Norges Bank

0 2 4 6 8 10

2012 2013 2014 2015 2016

Credit to households (C2)

16

(17)

House prices

Twelve-month change. Percent. January 2011 – April 2016

-2 0 2 4 6 8 10

2011 2012 2013 2014 2015 2016

(18)

-10 -5 0 5 10 15 20

2010 2011 2012 2013 2014 2015 2016

Oslo Bergen

Stavanger Trondheim

Tromsø Kristiansand

Drammen

Sources: Eiendom Norge, Finn.no and Eiendomsverdi 18

House prices in the largest cities

Twelve-month change. Percent. January 2010 – April 2016

(19)

GDP for mainland Norway

Four-quarter change. Seasonally adjusted. Volume. Percent.

2014 Q1 – 2016 Q3

²⁾

-2 -1 0 1 2 3 4 5

Mar-14 Sep-14 Mar-15 Sep-15 Mar-16 Sep-16

GDP mainland Norway MPR 1/16

SAM MPR 1/16¹⁾ SAM 11 May

1) System for Averaging short-term Models.

2) Projections for 2016 Q1 – 2016 Q3 (broken lines).

30% 50% 70% 90%

(20)

Exports of traditional goods

20

Excluding electricity and refined petroleum products.

Seasonally adjusted value index. January 2005 = 100. Three-month moving average. January 2000 – March 2016

0 50 100 150 200 250 300

2000 2003 2006 2009 2012 2015

Traditional goods excluding electricity and refined petroleum products Food products, beverages and tobacco

Machinery and other equipment Other goods

Source: Statistics Norway

(21)

Seasonally adjusted volume index. January 2012 – March 2016

Index of houshold consumption of goods

115 120 125 130 135

Jan-12 Jan-13 Jan-14 Jan-15 Jan-16

(22)

Structural non-oil deficit and 4% of the

Government Pension Fund Global (GPFG)

22

In billions of NOK. Constant 2016 prices. 2003 – 2019

0 50 100 150 200 250 300 350

2003 2006 2009 2012 2015 2018

Structural non-oil deficit

4% of GPFG

Sources: Ministry of Finance and Norges Bank

(23)

LFS ¹⁾ employment

In thousands of persons. Seasonally adjusted. January 2010 – February 2016

2 400 2 500 2 600 2 700

Jan-10 Jan-11 Jan-12 Jan-13 Jan-14 Jan-15 Jan-16

1) Labour Force Survey.

(24)

Unemployment. LFS ¹⁾ and NAV ²⁾

24

Share of labour force. Percent. Quarterly data. 1978 Q1 – 2016 Q1

1) Labour Force Survey.

2) Norwegian Labour and Welfare Aministration.

Sources: Statistics Norway and NAV

0 1 2 3 4 5 6 7 8 9

1978 1984 1990 1996 2002 2008 2014

LFS NAV

NAV including employment schemes

(25)

Registered unemployment by county

Share of labour force. Percent. January 2001 – April 2016

0 1 2 3 4 5

2001 2004 2007 2010 2013 2016

Hordaland, Møre og Romsdal, Rogaland and Vest-Agder Rest of Norway

(26)

Wage growth and wage norm for manufacturing

Sources: Technical Reporting Committee on Income Settlements (TBU) and Norges Bank 26

0 1 2 3 4 5 6 7

2003 2005 2007 2009 2011 2013 2015

Wage norm for manufacturing workers Wage growth - TBU

MPR 1/16

Percent. 2003 – 2016

(27)

CPI-ATE. Total and by supplier sector

Twelve-month change. Percent. January 2014 – June 2016

0 0.5 1 1.5 2 2.5 3 3.5 4 4.5 5

Jan-14 Jul-14 Jan-15 Jul-15 Jan-16

CPI-ATE

Imported consumer goods

Domestically produced goods and services Projections MPR 1/16

THE EXECUTIVE BOARD 11 MAY 2016