Executive Board Meeting

Executive Board Meeting

23 October 2013

2013 2014

US 1.6 2.6

Euro area -0.4 1.0

UK 1.4 1.9

Sweden 0.9 2.3

China 7.6 7.3

Emerging economies excluding

China 2.9 3.6

Trading partners 1.1 2.1

IMF projections for GDP growth

Source: IMF

2013 2014

Germany 0.5 1.4

France 0.2 1.0

Italy -1.8 0.7

Spain -1.3 0.2

Netherlands -1.3 0.3

Belgium 0.1 1.0

Euro area -0.4 1.0

Source: IMF

IMF projections for GDP growth

PMI for manufacturing ¹⁾

Diffusion index. January 2010 – September 2013

GDP growth ¹⁾

Percent. Quarterly data. Seasonally adjusted and annualised. HP filter (lambda = 2000). 1998 Q1 – 2013 Q2

-10 -5 0 5 10 15

-10 -5 0 5 10 15

98 00 02 04 06 08 10 12

Advanced economies Emerging economies HP filter

46 48 50 52 54 56 58

46 48 50 52 54 56 58

10 11 12 13

Advanced economies Emerging economies

Sources: Thomson Reuters and Norges Bank 1) Advanced economies and emerging economies in the trading aggregate,

GDP weights and export weights

Euro area

0 5 10 15 20 25 30

0 5 10 15 20 25 30

05 07 09 11 13

Spain Germany Portugal Ireland Italy France

Source: Thomson Reuters

Employment

Quarterly data. 2005 Q1 – 2013 Q2

PMI, monthly data. January 2005 – September 2013

Unemployment

Percentage of labour force. Monthly data. January 2005 – August 2013

-1.0 -0.8 -0.6 -0.4 -0.2 0.0 0.2 0.4 0.6 0.8 1.0

40 45 50 55 60

05 07 09 11 13

PMI for employment (left-hand scale)

Quarterly growth in employment

(right-hand scale)

Inflation – G20 countries

12-month change. January 2008 – August 2013

Advanced economies

08 09 10 11 12 13

-1 0 1 2 3 4 5

-1 0 1 2 3 4 5

Inflation Core inflation

Emerging economies

0 2 4 6 8 10

0 2 4 6 8 10

08 09 10 11 12 13

Inflation Core inflation

Sources: IMF, Thomson Reuters, CEIC and Norges Bank

Yields on 10-year government bonds in advanced economies

Percent. 1 January 2012 – 21 October 2013

0 1 2 3 4 5 6 7 8

0 1 2 3 4 5 6 7 8

Jan-12 Jul-12 Jan-13 Jul-13

US

Germany UK

Spain Italy

Source: Bloomberg

Expected key rates

Percent. 1 January 2010 – 31 December 2016

¹⁾

0 0.5 1 1.5 2 2.5 3

0 0.5 1 1.5 2 2.5 3

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

US

Euro area² ⁾ UK

Sweden

12 Sep 21 Oct

Sources: Bloomberg and Norges Bank 1) Expected key rates are derived from Overnight Index Swap (OIS) rates. Daily figures

from 1 January 2010 and quarterly figures from 2013 Q4 2) EONIA in the euro area

Oil price (Brent Blend) and prices for Norwegian petroleum exports ¹⁾

USD/barrel. January 2000 – January 2017

Sources: Statistics Norway, Thomson Reuters and Norges Bank

1) Weighted average of Norwegian crude oil and gas exports

0 25 50 75 100 125 150

0 25 50 75 100 125 150

2000 2002 2004 2006 2008 2010 2012 2014 2016

Oil

Petroleum exports

Futures 21 October

Futures MPR 3/13

Source: Norges Bank

-3.2 %

-2.6 % -2.5 % -2.5 %

-2.3 %

-0.7 %

-5.0 % -4.0 % -3.0 % -2.0 % -1.0 % 0.0 % 1.0 % 2.0 % EURNOK

GBPNOK I-44 CCI USDNOK SEKNOK

Developments in the krone exchange rate since MPR 3/13 (19 September 2013)

Percent. Per 21 October 2013

Depreciation of the

krone

Import-weighted exchange rate index (I-44) ¹⁾

3 January 2012 – 21 October 2013

84

86

88

90

92

94 84

86

88

90

92

94

Jan-12 May-12 Sep-12 Jan-13 May-13 Sep-13

I-44

Projections MPR 3/13 Average 2013 Q4

Source: Norges Bank 1) A positive slope denotes a stronger krone exchange rate

MPR 3/13

Import-weighted exchange rate index (I-44) ¹⁾

2 January 2003 – 21 October 2013

84

89

94

99

104 84

89

94

99

104

Jan-03 Jan-05 Jan-07 Jan-09 Jan-11 Jan-13

I-44

1) A positive slope denotes a stronger krone exchange rate Source: Norges Bank

Volatility in the krone exchange rate

Difference between highest and lowest traded EURNOK exchange rate. In øre (1 øre = NOK 0.01) . 10-day moving average. 1 January 2007 – 21 October 2013

0 5 10 15 20 25 30

0 5 10 15 20 25 30

Jan-07 Oct-07 Jul-08 Apr-09 Jan-10 Oct-10 Jul-11 Apr-12 Jan-13 Oct-13 Euro crisis

breaks out International financial

crisis

MPR 2/13 and FOMC SNB introduces

EURCHF floor

Source: Thomson Reuters

Expected key policy rate

Percent. 2013 Q4 – 2016 Q4

0 0.5 1 1.5 2 2.5 3 3.5 4

0 0.5 1 1.5 2 2.5 3 3.5 4

Oct-13 Oct-14 Oct-15 Oct-16

12 September 19 September 21 October

Baseline scenario in MPR 3/13

Sources: Thomson Reuters and Norges Bank

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

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

1995 1997 1999 2001 2003 2005 2007 2009 2011 2013 2015

GDP mainland Norway

GDP mainland Norway per capita Average 1995 – 2012

GDP mainland Norway

Annual change. Percent. 1995 – 2016

¹⁾

Sources: Statistics Norway and Norges Bank 1) Projections for 2013 – 2016

Household credit growth and rise in house prices ¹⁾

12-month change and seasonally adjusted monthly change. Percent January 2003 – September 2013

-10 -5 0 5 10 15 20

-5 -2.5 0 2.5 5 7.5 10

2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013

12-month change in credit growth,

(right-hand scale)

Monthly change in house prices, (left-hand scale)

12-month change in house prices,

(right-hand scale)

Sources: Real estate industry (NEF, EFF, FINN.no, Eiendomsverdi) and Statistics Norway

1) House prices in NOK per square meters

-60 -40 -20 0 20 40 60

Q2 Q3 Q4 Q2 Q3 Q4 Q2 Q3 Q4 Q2 Q3 Q4 Q2 Q3 Q4 -60

-40 -20 0 20 40 60

Fixed-rate loans Residential

mortgages

Total First-home

mortgages Home equity

lines of credit

Household credit demand. Net percentage balances.

^{1), 2)}

1

) Net percentage balances are calculated by weighting together the responses in the survey. The blue bars show reported developments for the relevant quarter. The red diamonds show expected developments for that quarter

2) Negative net percentage balances denote falling demand Source: Norges Bank

Unemployment

Percentage of labour force. Seasonally adjusted.

January 2004 – September 2013

1 2 3 4

1 2 3 4

2008 2009 2010 2011 2012 2013

NAV LFS

Sources: Statistics Norway and NAV

90 110 130 150 170 190 210 230 250 270

90 110 130 150 170 190 210 230 250 270

2000 2002 2004 2006 2008 2010 2012

Household consumption abroad Total consumption

Consumption of goods Consumption of services

Household consumption

Seasonally adjusted. Volume. 2000 Q1 = 100. 2000 Q1 – 2013 Q2

Source: Statistics Norway

CPI and CPI-ATE

12-month change. Percent. January 2000 – September 2013

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

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

2000 2002 2004 2006 2008 2010 2012

CPI CPI-ATE

Sources: Statistics Norway and Norges Bank

CPI-ATE. Total and by supplier sector

12-month change. Percent. January 2009 – December 2013

-2 -1 0 1 2 3 4

-2 -1 0 1 2 3 4

2009 2010 2011 2012 2013

Domestically produced goods and services Imported consumer goods

CPI-ATE

Sources: Statistics Norway and Norges Bank

Projections MPR 3/13