Monetary Policy Report 3/11

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Monetary Policy Report 3/11

Charts

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-2 -1 0 1 2 3

Chart 1.1 Projected output gap¹⁾ for Norway's trading partners.

Per cent. 2003 Q1 – 2014 Q4

MPR 3/11 MPR 2/11

-5 -4 -3

2003 2005 2007 2009 2011 2013

1) The output gap measures the percentage deviation between GDP and projected potential GDP for Norway's trading partners

Sources: IMF, Thomson Reuters and Norges Bank

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9 12 15 18 21 24

Chart 1.2 Yield spreads against German 10-year government bonds.

Percentage points. 1 January 2008 – 13 October 2011

Greece Ireland Portugal Spain Italy

0 3 6

Jan-08 Jul-08 Jan-09 Jul-09 Jan-10 Jul-10 Jan-11 Jul-11

Source: Thomson Reuters

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40 60 80 100 120

Chart 1.3 Developments in equity markets. Index.

1 January 2008 = 100. 1 January 2008 – 13 October 2011

0 20 40

US Euro area Norway Japan Emerging markets

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2 3 4 5 6

Chart 1.4 Yields on 10-year government bonds.

Per cent. 1 January 2003 – 13 October 2011

US

0 1 2

2003 2004 2005 2006 2007 2008 2009 2010 2011

US Germany

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2 3 4

Chart 1.5 Difference between 3-month money market rate and expected key rates¹⁾. Percentage points. 5-day moving average.

1 January 2008 – 13 October 2011

US Norway Euro area

0 1

1) Expected key rates are derived from Overnight Indexed Swap (OIS) rates.

Norges Bank's projections for market key rate expectations are used for Norway Sources: Bloomberg L.P., Thomson Reuters and Norges Bank

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3 4 5 6 7 8 9 10

Chart 1.6 Key policy rate, money market rate¹⁾, yield on 5-year covered bonds²⁾ and weighted average lending rate on new residential mortgages³⁾.

Per cent. 1 January 2008 – 13 October 2011

Money market rate Key policy rate

Bank lending rate (new residential mortgages) Yield on 5-year covered bonds

0 1 2 3

1) 3-month NIBOR (effective)

2) Sum of 3-month NIBOR and indicative credit spreads on 5-year covered bonds

3) Interest rate on new residential mortgages of NOK 1m within 60% of purchase price with variable interest rate. Figures for the 20 largest banks, weighted according to market share Sources: Norsk familieøkonomi AS, DnB Nor Markets, Statistics Norway and Norges Bank

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2 3 4 5 6

Chart 1.7 Key rates and estimated forward rates as at 16 June 2011 and 13 October 2011.¹⁾Per cent. 1 January 2008 – 31 December 2014²⁾

US

Euro area³⁾

UK

0 1 0

1

2008 2009 2010 2011 2012 2013 2014

1) Broken lines show estimated forward rates as at 16 June 2011. Thin lines show forward rates as at 13 October 2011. Forward rates are based on Overnight Indexed Swap (OIS) rates 2) Daily figures from 1 July 2008 and quarterly figures from 2011 Q4

3) EONIA in euro area from 2011 Q4 Sources: Bloomberg L.P. and Norges Bank

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0 2.5 5 7.5

Chart 1.8 Consumer prices. 12-month change.

Per cent. January 2003 – September 2011

CPI 20% trimmed mean

CPI-ATE ¹⁾ CPIXE ²⁾

CPI-FW ³⁾ CPIM⁴⁾

-2.5 0

2003 2004 2005 2006 2007 2008 2009 2010 2011

1) CPI adjusted for tax changes and excluding energy products

2) CPI adjusted for tax changes and excluding temporary changes in energy prices. Real time figures. See Norges Bank Staff Memo 7/2008 and 3/2009

3) CPI adjusted for frequency of price changes. See Norges Bank Economic commentaries 7/2009 4) Model-based indicator of underlying inflation. See Norges Bank Economic commentaries 5/2010 Sources: Statistics Norway and Norges Bank

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4 6 8 10 12 14

Chart 1.9 Inflation. Moving 10-year average¹⁾and variation²⁾in CPI³⁾.

Per cent. 1981 – 2011

Variation Inflation target CPI

0 2 4

1981 1986 1991 1996 2001 2006 2011

1) The moving average is calculated 10 years back

2) The band around the CPI is the variation in the CPI adjusted for tax changes and excluding energy products in the average period, measured by +/- one standard deviation 3) CPI projections in this Reportform the basis for this estimate

Sources: Statistics Norway and Norges Bank

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2.5 5

Chart 1.10 Expected consumer price inflation 2 and 5 years ahead.¹⁾

Per cent. 2003 Q1 – 2011 Q3

Expected inflation 5 years ahead Expected inflation 2 years ahead

0 0

2003 2004 2005 2006 2007 2008 2009 2010 2011

1) Average of expectations of employer/employee organisations and economists (financial industry experts, macro analysts and academia)

Sources: TNS Gallup and Perduco

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0.5 1 1.5

Chart 1.11 Five-year forward rate¹⁾ differential 5 years ahead between Norway and the euro area.²⁾ Percentage points. 1 January 2003 – 13 October 2011

0 0

2003 2004 2005 2006 2007 2008 2009 2010 2011

1) Based on swap rates

2) Expected inflation can be derived from the long-term interest rate differential. Due to a higher inflation target in Norway, the long-term interest rate differential will normally be 0.5 – 1 percentage point, depending on risk premium.

Sources: Thomson Reuters and Norges Bank

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2 3 4 5 6

Chart 1.12 Three-month money market rates.¹⁾Trading partners.

Per cent. 2008 Q1 – 2014 Q4

Market MPR 2/11 (16 June)

Market MPR 3/11 (13 October)

0 1 2

2008 2009 2010 2011 2012 2013 2014

1) Forward rates are based on money market rates and interest rate swaps Sources: Thomson Reuters and Norges Bank

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100 150 200 250

4 6 8 10 12

Chart 1.13 Household debt burden¹⁾ and interest burden²⁾.

Per cent. Quarterly figures. 1988 Q1 – 2014 Q4¹⁾

0 50 0

2

1988 1992 1996 2000 2004 2008 2012

Interest burden (left-hand scale) Debt burden (right-hand scale)

1) Loan debt as a percentage of disposable income adjusted for estimated reinvested dividends for 2000 – 2005 and redemption/reduction of equity capital for 2006 – 2014 2) Interest expenses after tax as a percentage of disposable income adjusted for estimated reinvested dividends for 2000 – 2005 and redemption/reduction of equity capital for

2006 – 2014 plus interest expenses

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3 4 5 6 7 8

Chart 1.14a Projected key policy rate in the baseline scenario with fan chart.

Per cent. 2008 Q1– 2014 Q4

30% 50% 70% 90%

0 1 2

2008 2009 2010 2011 2012 2013 2014

Source: Norges Bank

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1 0 1 2 3 4 5

Chart 1.14b Projected output gap¹⁾ in the baseline scenario with fan chart.

Per cent. 2008 Q1 – 2014 Q4

30% 50% 70% 90%

-4 -3 -2 -1

2008 2009 2010 2011 2012 2013 2014

1) The output gap measures the percentage deviation between mainland GDP and projected potential mainland GDP

Source: Norges Bank

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1 2 3 4 5

Chart 1.14c Projected CPI in the baseline scenario with fan chart.

Four-quarter change. Per cent. 2008 Q1 – 2014 Q4

30% 50% 70% 90%

-1 0 1

2008 2009 2010 2011 2012 2013 2014

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1 2 3 4 5

Chart 1.14d Projected CPIXE¹⁾ in the baseline scenario with fan chart.

30% 50% 70% 90%

-1 0 1

2008 2009 2010 2011 2012 2013 2014

1) CPI adjusted for tax changes and excluding temporary changes in energy prices.

As from August 2008, the CPIXE is a real time series. See Norges Bank Staff Memo 7/2008 and 3/2009

Source: Norges Bank

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3 4 5 6 7 8

Chart 1.15 Interval for the key policy rate at the end of each strategy period, actual developments and projected key policy rate in the baseline scenario.

Per cent. January 2008 – December 2014

MPR 1/11 MPR 2/11 MPR 3/11 Strategy period

3/07 1/08

Key policy rate

2/08

3/08

17 Dec 08

1/10 2/10 3/101/11

2/11 3/11

0 1 2

2008 2009 2010 2011 2012 2013 2014

Source: Norges Bank

1/09 2/09

3/091/10 2/10 3/10

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1 1.5 2

Chart 1.16 Difference between 3-month money market rate and expected key rates.¹⁾Percentage points. 2008 Q1 – 2014 Q4

Premium MPR 2/11 Premium MPR 3/11

0 0.5

2008 2009 2010 2011 2012 2013 2014

1) Norges Bank's projections from 2011 Q4 Source: Norges Bank

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0 1 2 3 4 5 85

88 91 94 97 100

Chart 1.17 Three-month money market rate differential between Norway¹⁾ and trading partners and the import-weighted exchange rate index (I-44)²⁾.

January 2003 – December 2014³⁾

-2 -1 0 100

103 106

2003 2005 2007 2009 2011 2013

I-44 (left-hand scale)

3-month rate differential (right-hand scale)

1) Key policy rate in the baseline scenario plus premiums in the Norwegian money market. The calculations are based on the assumption that announced interest rate changes are priced into the money market

2) A positive slope denotes a stronger krone exchange rate

3) Monthly figures from January 2003 and Norges Bank projections from 2011 Q4 Sources: Thomson Reuters and Norges Bank

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2 3 4 5 6

-1 0 1 2 3 4

Chart 1.18 Projected inflation¹⁾ and output gap in the baseline scenario.

Per cent. 2008 Q1 – 2014 Q4

Output gap (left-hand scale) CPIXE (right-hand scale)

-1 0 1

-4 -3 -2

2008 2009 2010 2011 2012 2013 2014

1) CPIXE: CPI adjusted for tax changes and excluding temporary changes in energy prices.

As from August 2008, the CPIXE is a real time series. See Norges Bank Staff Memo 7/2008 and 3/2009

Source: Norges Bank

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5 0 5 10 15 20 25

Chart 1.19 Real exchange rate. Deviation from mean over the period 1970 – 2010. Per cent. 1970 – 2011¹⁾

Relative consumer prices Relative wages

-20 -15 -10 -5

1970 1975 1980 1985 1990 1995 2000 2005 2010

1) The squares show the average so far in 2011. A positive slope indicates weaker competitiveness

Sources: Statistics Norway, Norwegian Technical Calculation Committee for Wage Settlements, Ministry of Finance and Norges Bank

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3 4 5 6 7 8

Chart 1.20a Key policy rate. Per cent. 2008 Q1 – 2014 Q4

Criterion 1 Criteria 1&2 Criteria 1,2&3 Baseline scenario

0 1 2

2008 2009 2010 2011 2012 2013 2014

Source: Norges Bank

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1 0 1 2 3 4 5

Chart 1.20b Output gap. Per cent. 2008 Q1 – 2014 Q4

-4 -3 -2 -1

2008 2009 2010 2011 2012 2013 2014

Source: Norges Bank

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1.5 2 2.5 3 3.5 4

Chart 1.20c CPIXE¹⁾. Four-quarter change. Per cent. 2008 Q1 – 2014 Q4

0 0.5 1

2008 2009 2010 2011 2012 2013 2014

1) CPI adjusted for tax changes and excluding temporary changes in energy prices.

As from August 2008, the CPIXE is a real time series. See Norges Bank Staff Memo 7/2008 and 3/2009

Source: Norges Bank

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3 4 5 6 7 8

Chart 1.21 Key policy rate and calculations based on simple monetary policy rules.¹⁾ Per cent. 2008 Q1 – 2012 Q1

Taylor rule Growth rule

Rule with foreign interest rates

Key policy rate in the baseline scenario

0 1 2

2008 2009 2010 2011 2012

1) The calculations are based on Norges Bank’s projections for the output gap, growth gap, consumer prices and 3-month money market rates among trading partners. To ensure comparability with the key policy rate, the simple rules are adjusted for risk premiums in 3-month money market rates

Source: Norges Bank

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2 3 4 5 6 7 8

Chart 1.22 Three-month money market rates in the baseline scenario¹⁾ and estimated forward rates²⁾. Per cent. 2008 Q1 – 2014 Q4

Estimated forward rates

Money market rates in the baseline scenario

0 1 2

2008 2009 2010 2011 2012 2013 2014

1) Key policy rate in the baseline scenario plus premiums in the Norwegian money market. The calculations are based on the assumption that announced interest rate changes are priced into the money market.

2) Forward rates are based on money market rates and interest rate swaps. The blue band shows the highest and lowest forward rates in the period 30 September – 13 October 2011 Sources: Thomson Reuters and Norges Bank

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3 4 5 6 7 8

Chart 1.23 Key policy rate and interest rate developments that follow from Norges Bank’s average pattern of interest rate setting.¹⁾

Per cent. 2003 Q1 – 2012 Q2

90% confidence interval Key policy rate

0 1 2

2003 2004 2005 2006 2007 2008 2009 2010 2011 2012

1) Interest rate movements are explained by developments in inflation, mainland GDP growth, wage growth and 3-month money market rates among trading partners. The equation is estimated over the period 1999 Q1 – 2011 Q2. See Staff Memo 3/2008 for further discussion Source: Norges Bank

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3 4 5 6 7 8

Chart 1.24a Key policy rate in the baseline scenario and in the alternative scenarios. Per cent. 2008 Q1 – 2014 Q4

Baseline scenario Increased growth abroad Weaker growth abroad

0 1 2

2008 2009 2010 2011 2012 2013 2014

Source: Norges Bank

30% 50% 70% 90%

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1 0 1 2 3 4 5

Chart 1.24b Output gap in the baseline scenario and in the alternative scenarios. Per cent. 2008 Q1 – 2014 Q4

-4 -3 -2 -1

2008 2009 2010 2011 2012 2013 2014

Source: Norges Bank

30% 50% 70% 90%

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2 3 4 5

Chart 1.24c CPIXE¹⁾ in the baseline scenario and in the alternative scenarios.

0 1

2008 2009 2010 2011 2012 2013 2014

30% 50% 70% 90%

1) CPI adjusted for tax changes and excluding temporary changes in energy prices. As from August 2008, CPIXE is a real time series. See Norges Bank Staff Memo 7/2008 and 3/2009 Source: Norges Bank

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3 4 5 6 7 8 9

Chart 1 Key policy rate in the baseline scenario in MPR 2/11 with fan chart and key policy rate in the baseline scenario in MPR 3/11 (red line).

Per cent. 2008 Q1 – 2014 Q4

30% 50% 70% 90%

0 1 2 3

2008 2009 2010 2011 2012 2013 2014

Source: Norges Bank

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0 1 2

0 1 2 Chart 2 Factors behind changes in the interest rate forecast since MPR 2/11.

Accumulated contribution. Percentage points. 2011 Q4 – 2014 Q4

Growth abroad Supplementary assessment

Capacity utilisation Prices and costs

Money market premiums Interest rates abroad Change in the interest rate forecast

-2 -1

2011Q4 2012Q2 2012Q4 2013Q2 2013Q4 2014Q2 2014Q4 -2 -1

Source: Norges Bank

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2 -1 0 1 2 3 4

G20 Advanced economies G20 Emerging markets

Chart 2.1 GDP growth in G20 advanced economies and G20 emerging markets.¹⁾ Quarterly growth. Per cent. 2006 Q1 – 2011 Q2

-3 -2 -3

-2

2006 2007 2008 2009 2010 2011

1) GDP-weighted (PPP)

Sources: IMF, Thomson Reuters and Norges Bank

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-10 0 10 20 30 40 50 60 70

US Euro area UK Spain Sweden

Households: from 2000 to peak Public sector: from 2000 to peak Households: from 2000 to current level Public sector: from 2000 to current level

Chart 2.2 Change in debt for households¹⁾ and public sector²⁾. Percentage points.

Change from 2000 Q1 to peak and from 2000 Q1 to current level

-30 -20 -30

-20

1) Gross debt as a percentage of disposable income 2) Gross debt as a percentage of GDP

Sources: Thomson Reuters, ECB and Norges Bank

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20 40 60 80 100 120 140 160

Housing starts Existing home sales New home sales

Chart 2.3 Housing indicators for the US. Index, January 2001 = 100. January 2001 – August 2011

0 20 0

20

2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011

New home sales

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80 90 100 110

US Germany Euro area Sweden UK

Chart 2.4 Private investment.¹⁾ Index, Q1 2008 = 100.

2007 Q1 – 2011 Q2

70 70

2007 2008 2009 2010 2011

1) Gross fixed capital investment for the euro area, Germany and Sweden. Private non-residential investment for the US. Business investment for the UK

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1 2 3 4

1 2 3

4 US

Euro area UK Sweden

Chart 2.5 Consumer prices excluding food and energy.¹⁾ 12-month change.

Per cent. January 2006 – August 2011

0 0

2006 2007 2008 2009 2010 2011

1) HICP excluding energy, food, alcohol and tobacco for the euro area, UK and Sweden Source: Thomson Reuters

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-2 0 2 4 6 8

US Euro area UK

Chart 2.6 Unit labour costs. Total economy. Four-quarter change. Per cent.

2006 Q1 – 2011 Q1

-4 -4

2006 2007 2008 2009 2010 2011

Source: OECD

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0 2 4 6 8 10 12 14 16

Brazil Russia China India

Chart 2.7 Core inflation in emerging markets¹⁾. 12-month change. Per cent.

January 2006 – August 2011

-4 -2 -4

-2

2006 2007 2008 2009 2010 2011

1) India: wholesale prices for manufactured goods Source: Thomson Reuters

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40 60 80 100 120 140 160

Chart 2.8 Oil price (Brent Blend) and prices for Norwegian petroleum exports¹⁾. USD/barrel. January 2003 – April 2014

Oil price Futures

Futures as at MPR 2/11 Futures as at MPR 1/11 Petroleum price

0 20 0

20

2000 2002 2004 2006 2008 2010 2012 2014

1) Weighted average of Norwegian crude oil and gas exports Sources: Statistics Norway, Thomson Reuters and Norges Bank

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5 10 15 20 25

Chart 2.9 Prices for coal, crude oil and natural gas. USD per MMBTU.

January 2003 – August 2014

Coal US¹⁾

Oil¹⁾

Gas UK¹⁾

Gas US¹⁾

Gas Russia Gas Norway²⁾

Futures

0 0

2003 2005 2007 2009 2011 2013

1) For October 2011 calculated as daily average

2) Calculation of future gas prices for Norway based on assumptions in 2012 National Budget Sources: IMF, Thomson Reuters, Statistics Norway, Ministry of Finance and Norges Bank

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100 200 300 400 500 600 700

Aluminium Copper Wheat Cotton

Chart 2.10 Commodity prices. USD. Spot and futures prices.

Index, January 2003 = 100. January 2003 – October 2014

Futures

0 100 0

100

2003 2005 2007 2009 2011 2013

Sources: CME Group and Thomson Reuters

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2.5 5 7.5

CPI CPI-ATE CPIXE

Chart 2.11 CPI, CPI-ATE¹⁾and CPIXE²⁾. 12-month change. Per cent.

January 2008 – June 2012³⁾

0 0

2008 2009 2010 2011 2012

2) CPI adjusted for tax changes and excluding temporary changes in energy prices. Real-time figures. See Norges Bank Staff Memo7/2008 and 3/2009

3) Projections for October 2011 – June 2012 (broken lines). Monthly figures to March 2012, then quarterly figures

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0 2.5 5 7.5

Chart 2.12 CPI-ATE¹⁾. Total and by supplier sector.

12-month change. Per cent. January 2008 – June 2012²⁾

CPI-ATE Imported consumer goods Domestically produced goods and services ³⁾

-2.5 0

2008 2009 2010 2011 2012

2) Projections for October 2011 – June 2012 (broken lines). Monthly figures to March 2012, then quarterly figures

3) Norges Bank's estimates

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-6 -4 -2 0 2 4

Chart 2.13 Prices for imported consumer goods in the CPI-ATE and prices for clothing in the CPI. 12-month change. Per cent.

January 2008 – September 2011

Imported consumer goods Clothing

-10 -8 -10

-8

2008 2009 2010 2011

Source: Statistics Norway

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-0.5 0 0.5 1

Chart 2.14 Indicator of external price impulses to imported consumer goods measured in foreign currency. Annual change. Per cent. 2002 – 2012¹⁾

-1.5 -1 -1.5

-1

2002 2004 2006 2008 2010 2012

1) Projections for 2011 and 2012 Source: Norges Bank

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1 2 3

MPR 3/11 SAM CPI-ATE

Chart 2.15 CPI-ATE¹⁾. Actual figures, baseline scenario and projections from SAM²⁾with fan chart. Four-quarter change. Per cent. 2010 Q4 – 2012 Q2³⁾

30% 50% 70% 90%

0 0

Dec-10 Jun-11 Dec-11 Jun-12

1) CPI adjusted for tax changes and excluding energy products 2) System for averaging models

3) Projections for 2011 Q4 – 2012 Q2 (broken lines) Sources: Statistics Norway and Norges Bank

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0 2 4

Regional network Mainland GDP growth

Chart 2.16 GDP mainland Norway^1,2) and Norges Bank's regional network's indicator of change in production past three months and expected change in production next six months. Per cent. 2003 Q1 – 2012 Q2³⁾

-2 -2

2003 2004 2005 2006 2007 2008 2009 2010 2011 2012

1) Seasonally adjusted quarterly change. Volume

2) High electricity production may contribute by about ¼ percentage point higher quarterly growth in GDP mainland Norway in 2011 Q3 than shown in the chart

3) Latest observation in the Regional network is September 2011. Latest GDP observation is 2011 Q2, projections for 2011 Q3 – 2012 Q2 (broken line)

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120 130 140 150 160

Mainland Norway Total

Chart 2.17 Terms of trade. Index. 2003 Q1 = 100.

2003 Q1 – 2011 Q2

90 100 110

2003 2004 2005 2006 2007 2008 2009 2010 2011

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2 3 4 5 6 7

Mainland GDP MPR 3/11 SAM

Chart 2.18 GDP mainland Norway. Actual figures, baseline scenario¹⁾and projections from SAM²⁾with fan chart. Four-quarter change. Volume.

Seasonally adjusted. Per cent. 2010 Q1 – 2012 Q2³⁾

30% 50% 70% 90%

0 1 0

1

Mar-10 Sep-10 Mar-11 Sep-11 Mar-12

1) High electricity production may contribute by about ¼ percentage point higher quarterly growth in GDP mainland Norway in 2011 Q3 than shown in the chart

2) System for averaging models

3) Projections for 2011 Q3 – 2012 Q2 (broken lines) Sources: Statistics Norway and Norges Bank

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30 40 50 60 70 80

0 1 2 3 4 5

Output gap MPR 3/11 (left-hand scale) Capacity constraints (right-hand scale) Labour supply (right-hand scale)

Chart 2.19 Capacity constraints and labour supply¹⁾in Regional network and estimated output gap. Per cent. January 2005 – September 2011

10 20 30

-2 -1 0

2005 2006 2007 2008 2009 2010 2011

1) Share of contacts that will have some or considerable problems accommodating an increase in demand and the share of contacts where production is constrained by labour supply

Source: Norges Bank

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200 300 400 500

Services Traditional goods

Chart 2.20 Exports from mainland Norway. Constant 2007 prices.

In billions of NOK. 1992 – 2012¹⁾

0 100

1992 1997 2002 2007 2012

1) Projections for 2011 and 2012

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4 6 8

Household consumption Household real disposable income

Chart 2.21 Household consumption¹⁾and real disposable income²⁾. Annual change. Per cent. 2003 – 2014³⁾

0 2

2003 2005 2007 2009 2011 2013

0 2

1) Includes consumption among non-profit organisations. Volume

2) Excluding dividend income. Including income in non-profit organisations 3) Projections for 2011 – 2014 (broken line)

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-5 0 5 10 15

Saving ratio excl. dividend income Saving ratio, adjusted ²⁾

Net lending ratio excl. dividend income

Chart 2.22 Household saving and net lending as a share of disposable income. Per cent. 1992 – 2014¹⁾

-15 -10

1992 1996 2000 2004 2008 2012

-15 -10

1) Projections for 2011 – 2014 (broken lines)

2) Adjusted for estimated reinvested dividends for 2000 – 2005 and redemption/reduction of equity capital for 2006 – 2014

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800 1000 1200

40 60 80 100 120 140 Chart 2.23 Housing starts¹⁾and order intake for residential construction²⁾.

1992 Q1 – 2011 Q2

Order intake (right-hand scale) Housing starts (left-hand scale)

400 600

1992 1996 2000 2004 2008

0 20 40

1) In 1000s of square meters. Seasonally adjusted

2) Seasonally adjusted value index deflated by the price index for housing

investment in the national accounts. Deferred two quarters forward. 2007 = 100 Sources: Statistics Norway and Norges Bank

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3 -2 -1 0 1 2 3 4

Manufacturing Retail trade Services

Chart 2.24 Planned growth in investment for next 12 months compared with past 12 months. Index.¹⁾October 2002 – September 2011

-4 -3 -4

-3

2002 2003 2004 2005 2006 2007 2008 2009 2010 2011

1) The scale runs from -5 to +5, where -5 denotes a sharp fall and +5 denotes strong growth.

See article "Norges Bank's regional network: fresh and useful information" in Economic Bulletin2/2009 for further information

Source: Norges Bank

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150 200 250 300 350

Business Housing

Chart 2.25 Investment in mainland Norway excluding public sector.

Constant 2007 prices. In billions of NOK. 1992 – 2014¹⁾

0 50 100

1992 1997 2002 2007 2012

1) Projections for 2011 – 2014

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0 1 2

Regional network Employment growth

Chart 2.26 Employment¹⁾and Norges Bank's regional network's indicator of change in employment and expected change in employment next three months. Per cent. 2003 Q1 – 2012 Q2²⁾

-1 -1

2003 2004 2005 2006 2007 2008 2009 2010 2011 2012

1) Seasonally adjusted quarterly change in Quarterly National Accounts 2) Latest observation in the Regional network is September 2011.

Latest observation in the Quarterly National Accounts is 2011 Q2, projections for 2011 Q3 – 2012 Q2 (broken line)

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30 40 50 60 70

Net migration Excess of births Population growth

Chart 2.27 Population growth, net migration and excess of births.

Sum of four previous quarters. In 1000s of persons. 2003 Q1 – 2014 Q4¹⁾

0 10 20

2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

1) Projections for 2011 Q3 - 2014 Q4 Sources: Statistics Norway and Norges Bank

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2500 2600 2700

Labour force participation at 2006 level Labour force participation at 2007 level Actual labour force, trend

Chart 2.28 Actual trend in labour force and labour force given demografic developments¹⁾. In 1000s. January 2000 – December 2011

2300 2400

2000 2002 2004 2006 2008 2010 2012

1) Total labour force given unchanged labour force participation in every age group from the 2006/2007 level

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2 3 4 5

Chart 2.29 Registered unemployment. Percentage of labour force.

Seasonally adjusted. 2003 Q1 – 2012 Q2¹⁾

0 1

2003 2004 2005 2006 2007 2008 2009 2010 2011 2012

1) Projections for 2011 Q4 – 2012 Q2 (broken line)

Sources: Norwegian Labour and Welfare Administration, Statistics Norway and Norges Bank

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110 115 120 125 130 135

Chart 2.30 GDP per hour worked for mainland Norway. Index,

1997 Q1 = 100. Seasonally adjusted. Market value. 1997 Q1 – 2012 Q2¹⁾

95 100 105

1997 1999 2001 2003 2005 2007 2009 2011

1) Projections for 2011 Q3 – 2012 Q2 (broken line) Sources: Statistics Norway and Norges Bank

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3 4 5 6 7

Chart 2.31 Non-oil budget deficit and structural non-oil budget deficit.

Percentage of GDP mainland Norway. 2003 – 2012¹⁾

Non-oil deficit

Structural, non-oil deficit

0 1 2

2003 2004 2005 2006 2007 2008 2009 2010 2011 2012

1) Projections for 2011 and 2012

Sources: Ministry of Finance and Statistics Norway

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60 90 120 150 180

Chart 2.32 Structural, non-oil deficit and expected real return on the Government Pension Fund Global. Constant 2012 prices.

In billions of NOK. 2001 – 2014¹⁾

Structural, non-oil deficit Expected real return

0 30 0

30

2001 2003 2005 2007 2009 2011 2013

Sources: Ministry of Finance and Norges Bank

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60 90 120 150

Chart 2.33 Petroleum investment. Constant 2007 prices. In billions of NOK.

1992 – 2014¹⁾

0 30

1992 1996 2000 2004 2008 2012