200820092010201120122013201490929496981001021041061089092949698100102104106108Chart 1.1 GDP. Seasonally adjusted volume index.2008 Q1=100. 2008 Q1 − 2014 Q2

(1)

2008 2009 2010 2011 2012 2013 2014 90

92 94 96 98 100 102 104 106 108

90 92 94 96 98 100 102 104 106 108 Chart 1.1 GDP. Seasonally adjusted volume index.

2008 Q1=100. 2008 Q1 − 2014 Q2

Sources: Thomson Reuters and Norges Bank

US

Euro area

UK

Sweden

Japan

(2)

2010 2011 2012 2013 2014 2015 2016 2017 0

1 2 3 4 5 6

0 1 2 3 4 5 6 Chart 1.2 GDP for trading partners in MPR 2/14 and MPR 3/14. Volume.

Four−quarter change. Percent. 2010 Q1 − 2017 Q4

¹⁾

1) Projections from 2014 Q3 (broken lines).

MPR 2/14

MPR 3/14

(3)

2010 2011 2012 2013 2014

−1 0 1 2 3 4 5 6

−1 0 1 2 3 4 5 6 Chart 1.3 Consumer prices.

Twelve−month change. Percent. January 2010 − August 2014

¹⁾

1) Up to and including July 2014 for US and UK.

Sources: Eurostat and Bureau of Labour Statistics

US

Euro area

UK

Sweden

(4)

2010 2011 2012 2013 2014 2015 2016 2017 0

100 200 300 400 500 600

0 20 40 60 80 100 120 140 160 Chart 1.4 Oil and gas prices.

¹⁾

January 2010 − March 2017

²⁾³⁾

1) USD per barrel for oil and USD per thousand standard cubic metres (Sm³) for gas.

2) The most recent daily observation (11 september 2014) is used for oil and UK gas prices in September 2014.

3) Forward prices from September 2014.

Sources: IMF, Thomson Reuters, Statistics Norway and Norges Bank

Gas UK (left-hand scale)

Gas Norway (left-hand scale)

Oil (right-hand scale)

(5)

2010 2011 2012 2013 2014 0

1 2 3 4 5 6 7 8

0 1 2 3 4 5 6 7 8 Chart 1.5 Yields on 10−year government bonds.

Percent. 1 January 2010 − 11 September 2014

Source: Bloomberg

US

Germany

UK

Spain

Italy

(6)

2010 2011 2012 2013 2014 2015 2016 2017

−1 0 1 2 3

−1 0 1 2 3 Chart 1.6 Key rates and estimated forward rates at 12 June 2014 and

11 September 2014.

¹⁾

. Percent. 1 January 2010 − 1 October 2017

²⁾

1) Broken lines show estimated forward rates at 12 June 2014. Thin lines show forward rates at 11 September 2014. Forward rates are based on Overnight Index Swap (OIS) rates.

2) Daily data from 1 January 2010 and quarterly data from 2014 Q4.

3) EONIA for the euro area from 2014 Q3.

Sources: Bloomberg and Norges Bank

US

Euro area

³⁾

UK

Sweden

(7)

2010Q1 2011Q1 2012Q1 2013Q1 2014Q1 2015Q1 2016Q1 2017Q1 0

0.5 1 1.5 2 2.5 3

0 0.5 1 1.5 2 2.5 3 Chart 1.7 Money market rates for trading partners in MPR 2/14 and MPR 3/14.

¹⁾

Percent. 2010 Q1 − 2017 Q4

1) Broken blue and purple lines show estimated forward rates at 11 September 2014 and 12 June 2014, respectively.

Sources: Bloomberg and Norges Bank

MPR 2/14

MPR 3/14

(8)

2008 2009 2010 2011 2012 2013 2014 110

105 100 95 90 85 80

110 105 100 95 90 85 80 Chart 1.8 Import−weighted exchange rate index (I−44).

¹⁾

1 January 2008 − 11 September 2014

1) A positive slope denotes a stronger krone exchange rate.

Source: Norges Bank

I−44

MPR 2/14

(9)

2010 2011 2012 2013 2014 0

1 2 3 4 5 6

0 1 2 3 4 5 6 Chart 1.9 Residential mortgage lending rates

¹⁾

and funding costs.

Percent. 1 January 2010 − 11 September 2014

1) The interest rate on lines of credit secured on dwellings provided by all banks and mortgage companies in Norway.

2) Estimated using weighted interest rates on covered bonds outstanding and weighted deposit rates.

3) Credit lines.

Sources: DNB Markets, Statistics Norway and Norges Bank

Key policy rate

Difference between money market rate and key policy rate Risk premium on 5−year covered bonds

Estimated cost of mortgage financing

²

Residential mortgage rate

³

(10)

2008 2009 2010 2011 2012 2013 2014

−6

−4

−2 0 2 4 6 8

−6

−4

−2 0 2 4 6 8 Chart 1.10 Norges Bank’s regional network indicator for output growth preceding three months. Annualised. Percent. January 2008 − August 2014

Source: Norges Bank

Manufacturing

Construction

Retail

Services

(11)

2008 2009 2010 2011 2012 2013 2014 2015 0

1 2 3 4

0 1 2 3 4 Chart 1.11 Unemployment rate. LFS

¹⁾

and NAV

²⁾

Seasonally adjusted. Percent. January 2008 − March 2015

³⁾

1) Labour Force Survey.

2) Norwegian Labour and Welfare Administration.

3) Projections for September 2014 − March 2015 (broken line).

Sources: Statistics Norway, NAV and Norges Bank

LFS

NAV

NAV including employment schemes

(12)

2010 2011 2012 2013 2014

−2

−1 0 1 2 3 4

−10

−5 0 5 10 15 20 Chart 1.12 House prices. Twelve-month change and seasonally adjusted monthly change. Percent. January 2010 − August 2014

Sources: Eiendom Norge, Eiendomsverdi and Finn.no

House prices, seasonally adjusted monthly change (left-hand scale)

House prices, twelve-month change (right-hand scale)

(13)

2010 2011 2012 2013 2014 0

1 2 3 4 5

0 1 2 3 4 5

30% 50% 70% 90%

Chart 1.13 GDP for mainland Norway. Actual figures, baseline scenario and projections from SAM

¹⁾

with fan chart.

Four−quarter change. Volume. Seasonally adjusted. Percent. 2010 Q1 − 2014 Q4

²⁾

1) System for averaging short−term models.

2) Projections for 2014 Q3 − 2014 Q4 (broken lines).

Sources: Statistics Norway and Norges Bank

GDP, mainland Norway MPR 3/14

SAM

(14)

2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015

−2 0 2 4

−2 0 2 4 Chart 1.14 GDP for mainland Norway

¹⁾

and Norges Bank’s regional network’s indicator of output growth preceding three months and expected output growth next six months. Percent. January 2003 − February 2015

²⁾

1) Seasonally adjusted quarterly change. Volume.

2) Latest observation in the regional network is August 2014. Latest GDP observation is 2014 Q2. Projections for 2014 Q3 − 2014 Q4 (broken line).

Regional network

GDP growth, mainland Norway

(15)

2008 2009 2010 2011 2012 2013 2014 0

10 20 30 40 50 60 70 80

0 10 20 30 40 50 60 70 80 Chart 1.15 Capacity constraints and labour availability

¹⁾

as reported by Norges Bank’s regional network. Percent. January 2008 − August 2014

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

Capacity constraints

Labour availability

(16)

2010 2011 2012 2013 2014 0

1 2 3 4 5

0 1 2 3 4 5 Chart 1.16 CPI and CPI−ATE.

¹⁾

12−month change.

Percent. January 2010 − December 2014

²⁾

1) CPI adjusted for tax changes and excluding energy products.

2) Projections for September 2014 − December 2014 (broken lines).

CPI

CPI−ATE

(17)

2010 2011 2012 2013 2014

−2.5 0 2.5 5

−2.5 0 2.5 5 Chart 1.17 CPI−ATE.

¹⁾

Total and by supplier sector.

12−month change. Percent. January 2010 − December 2014

²⁾

2) Projections for September 2014 − December 2014 (broken lines).

3) Norges Bank estimates.

CPI−ATE

Imported consumer goods

Domestically produced goods and services

³⁾

Projections MPR 2/14

(18)

2003 2005 2007 2009 2011 2013

−1.5

−1

−0.5 0 0.5 1

−1.5

−1

−0.5 0 0.5 1 Chart 1.18 Indicator of external price impulses to imported consumer goods

measured in foreign currency. Annual change. Percent. 2003 − 2014

¹⁾

1) Projections for 2014.

Source: Norges Bank

(19)

2010 2011 2012 2013 2014 0

0.5 1 1.5 2 2.5 3 3.5 4 4.5 5

0 0.5 1 1.5 2 2.5 3 3.5 4 4.5 5

30% 50% 70% 90%

Chart 1.19 CPI−ATE

¹⁾

. Actual figures, baseline scenario and projections from SAM

²⁾

with fan chart. Four−quarter change. Percent. 2010 Q1 − 2014 Q4

³⁾

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

2) System for averaging short−term models.

CPI−ATE

MPR 3/14

SAM

(20)

1992 1995 1998 2001 2004 2007 2010 2013 2016 0

50000 100000 150000 200000 250000

0 50000 100000 150000 200000 250000 Chart 1.20 Petroleum investment. Constant 2010 prices.

In millions of NOK. 1992 − 2017

¹⁾

1) Projections for 2014 − 2017 (broken lines).

MPR 3/14

MPR 2/14

(21)

2003 2005 2007 2009 2011 2013 2015 2017 0

50 100 150 200 250

0 50 100 150 200 250 Chart 1.21 Structural non−oil deficit and four percent of the Government Pension Fund Global. Constant 2014 prices. In billions of NOK. 2003 − 2017

¹⁾

1) Projections for 2014 − 2017.

Sources: Ministry of Finance and Norges Bank

Structural non−oil deficit

Four percent of GPFG

(22)

1981 1986 1991 1996 2001 2006 2011 0

2 4 6 8 10 12 14

0 2 4 6 8 10 12 14 Chart 2.1 10−year moving average

¹⁾

and variation

²⁾

in CPI.

Annual change. Percent. 1981 − 2013

1) The moving average is calculated 10 years back.

2) The band around the CPI is the variation in the CPI in the average period, measured by +/− one standard deviation.

Variation

Inflation target

CPI

(23)

2008 2009 2010 2011 2012 2013 2014 0

2.5 5

0 2.5 5 Chart 2.2 Expected consumer price inflation 2 and 5 years ahead.

¹⁾

Percent. 2008 Q1 − 2014 Q3

1) Average of expectations of employer/employee organisations and economists in the financial industry and academia.

Sources: TNS Gallup and Opinion

Expected inflation 5 years ahead

Expected inflation 2 years ahead

(24)

2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 0

1 2 3 4 5 6 7

0 1 2 3 4 5 6 7

30% 50% 70% 90%

Chart 2.3a Projected key policy rate in the baseline scenario with fan chart. Percent. 2008 Q1 − 2017 Q4

¹⁾

1) Projections for 2014 Q3 − 2017 Q4 (broken line).

Source: Norges Bank

(25)

2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

−4

−3

−2

−1 0 1 2 3 4 5

−4

−3

−2

−1 0 1 2 3 4 5

30% 50% 70% 90%

Chart 2.3b Projected output gap

¹⁾

in the baseline scenario with fan chart. Percent. 2008 Q1 − 2017 Q4

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

Source: Norges Bank

(26)

2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

−1 0 1 2 3 4 5

30% 50% 70% 90%

Chart 2.3c Projected CPI in the baseline scenario with fan chart. Four−quarter change. Percent. 2008 Q1 − 2017 Q4

¹⁾

(27)

2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

−1 0 1 2 3 4 5

30% 50% 70% 90%

Chart 2.3d Projected CPI−ATE

¹⁾

in the baseline scenario with fan chart. Four−quarter change. Percent. 2008 Q1 − 2017 Q4

²⁾

(28)

3/07 1/082/08

3/08

17 Dec 08

1/092/09

3/091/102/103/101/11 2/11

3/11

1/12 2/12 3/12

1/13 2/13

3/13 4/13

1/14 2/14

3/14

2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 0

1 2 3 4 5 6 7 8

0 1 2 3 4 5 6 7 8 Chart 2.4 Interval for the key policy rate at the end of each strategy period, actual developments and projected key policy rate in the baseline scenario.

Percent. 1 January 2008 − 31 December 2017

Source: Norges Bank

MPR 1/14

MPR 2/14

MPR 3/14

(29)

2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 0

1 2 3 4 5 6 7 8

0 1 2 3 4 5 6 7 8 Chart 2.5 Key policy rate, three−month money market rate

¹⁾

, interest rate on loans to households

²⁾

and foreign money market rates in the baseline scenario.

Percent. 2008 Q1 − 2017 Q4

³⁾

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) Average interest rate on all loans to households from banks and mortgage companies.

Key policy rate

Three−month money market rate Lending rate, households

Foreign money market rates

(30)

2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

−4

−3

−2

−1 0 1 2 3 4

−1 0 1 2 3 4 5 6 Chart 2.6 Inflation and output gap in the baseline scenario.

Percent. 2008 Q1 − 2017 Q4

Output gap (left−hand scale)

CPI−ATE

^1,2)

(right−hand scale)

(31)

2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

−15

−10

−5 0 5 10 15

−15

−10

−5 0 5 10 15 Chart 2.7 Export market growth.

Import growth. 25 trading partners. Annual change. Percent. 2008 − 2017

¹⁾

1) Projections for 2014 − 2017 (broken line).

(32)

1993 1996 1999 2002 2005 2008 2011 2014 2017

−15

−10

−5 0 5 10 15

−15

−10

−5 0 5 10 15 Chart 2.8 Household saving and net lending as a share of disposable income.

Percent. 1993 − 2017

¹⁾

1) Projections for 2014 − 2017 (broken lines).

Saving ratio

Saving ratio excl. dividend income

Net lending ratio, excl. dividend income

(33)

2003 2005 2007 2009 2011 2013 2015 2017 0

2 4 6 8

0 2 4 6 8 Chart 2.9 Household consumption

¹⁾

and real disposable income.

²⁾

Annual change. Percent. 2003 − 2017

³⁾

1) Includes consumption for non−profit organisations. Volume.

2) Excluding dividend income. Including income for non−profit organisations.

3) Projections for 2014 − 2017.

Household consumption Household real disposable income

(34)

2003 2005 2007 2009 2011 2013 2015 2017

−10

−5 0 5 10 15 20

−10

−5 0 5 10 15 20 Chart 2.10 Household credit

¹⁾

and house prices.

Four−quarter change. Percent. 2003 Q1 − 2017 Q4

²⁾

1) Domestic credit to households.

Sources: Statistics Norway, Eiendom Norge, Eiendomsverdi, Finn.no and Norges Bank

House prices

Credit

(35)

2003 2007 2011 2015 0

2 4 6 8 10 12

0 50 100 150 200 250 Chart 2.11 Household debt ratio

¹⁾

and interest burden.

²⁾

Percent. 2003 Q1 − 2017 Q4

³⁾

1) Loan debt as a percentage of disposable income adjusted for estimated reinvested dividend income for 2003 – 2005 and redemption/reduction of equity capital for 2006 – 2012 Q3.

2) Interest expenses as a percentage of disposable income adjusted for estimated reinvested dividend income for 2003 – 2005 and redemption/reduction of equity capital for 2006 – 2012 Q3 plus interest expenses.

Interest burden (left−hand scale)

Debt ratio (right−hand scale)

(36)

2003 2005 2007 2009 2011 2013 2015 2017 105

100 95 90 85 80

−2

−1 0 1 2 3 4 5 Chart 2.12 Three−month money market rate differential between Norway

¹⁾

and trading partners and import−weighted exchange rate index (I−44).

²⁾

January 2003 − December 2017

³⁾

2) A positive slope denotes a stronger krone exchange rate.

3) Projections September 2014 − December 2017 (broken lines).

I−44 (left−hand scale)

Three−month rate differential (right−hand scale)

(37)

2008 2009 2010 2011 2012 2013 2014 2015 0

1 2 3 4 5 6 7 8

0 1 2 3 4 5 6 7 8 Chart 2.13 Key policy rate and calculations based on simple monetary

policy rules.

¹⁾

Percent. 2008 Q1 − 2015 Q1

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

three−month money market rates.

Source: Norges Bank

Key policy rate in the baseline scenario Rule with foreign interest rate

Growth rule

Model−robust rule

Taylor rule

(38)

2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 0

1 2 3 4 5 6 7 8

0 1 2 3 4 5 6 7 8 Chart 2.14 Three−month money market rate in the baseline scenario

¹⁾

and estimated forward rates.

²⁾

Percent. 2008 Q1 − 2017 Q4

2) Forward rates are based on money market rates and interest rate swaps. The red and blue bands show the highest and lowest rates in the period 30 May − 12 June 2014 and 29 August − 11 September 2014.

Estimated forward rates MPR 2/14

Estimated forward rates MPR 3/14

Money market rate in the baseline scenario MPR 2/14

Money market rate in the baseline scenario MPR 3/14

(39)

2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 0

1 2 3 4 5 6 7 8

0 1 2 3 4 5 6 7 8 Chart 2.15 Key policy rate and interest rate developments that follow from

Norges Bank’s average pattern for interest rate setting.

¹⁾

Percent. 2004 Q1 − 2015 Q1

1) Interest rate movements are explained by developments in inflation, mainland GDP growth, wage growth and three−month money market rates among trading partners, as well as the interest rate in the previous period. The equation is estimated over the period 1999 Q1 – 2014 Q2. See Norges Bank Staff Memo 3/2008 for further discussion.

Source: Norges Bank

90% confidence interval

Key policy rate in baseline scenario

(40)

2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 0

1 2 3 4 5 6

0 1 2 3 4 5 6 Chart 2.16a Key policy rate. Percent. 2008 Q1 − 2017 Q4

Source: Norges Bank

Criterion 1

Criteria 1&2

Criteria 1,2&3

(41)

2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

−2

−1 0 1 2 3 4

−2

−1 0 1 2 3 4 Chart 2.16b Output gap. Percent. 2008 Q1 − 2017 Q4

Source: Norges Bank

Criterion 1

Criteria 1&2

Criteria 1,2&3

(42)

2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 0

1 2 3 4

0 1 2 3 4 Chart 2.16c CPI−ATE.

¹⁾

Four−quarter change. Percent. 2008 Q1 − 2017 Q4

Criterion 1

Criteria 1&2

Criteria 1,2&3

(43)

2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 0

1 2 3 4 5 6 7

0 1 2 3 4 5 6 7

30% 50% 70% 90%

Chart 2.17 Key policy rate in the baseline scenario in MPR 2/14 with fan chart and key policy rate in the baseline scenario in MPR 3/14 (purple line).

Percent. 2008 Q1 − 2017 Q4

Source: Norges Bank

(44)

2014Q4 2015Q2 2015Q4 2016Q2 2016Q4 2017Q2 2017Q4

−2

−1 0 1 2

−2

−1 0 1 2 Chart 2.18 Factors behind changes in the interest rate forecast since MPR 2/14.

Cumulative contribution. Percentage points. 2014 Q4 − 2017 Q4

Source: Norges Bank

Change in interest rate forecast Capacity utilisation

Prices Foreign demand

Interest rates abroad Exchange rate

(45)

1976 1980 1984 1988 1992 1996 2000 2004 2008 2012 50

100 150 200

50 100 150 200 Chart 3.1 Total credit

¹⁾

mainland Norway as a share of mainland GDP.

Percent. 1976 Q1 − 2014 Q2

1) The sum of C2 households and C3 non-financial enterprises in mainland Norway (all non-financial enterprises pre-1995). C3 comprises C2 and foreign debt.

Sources: Statistics Norway, IMF and Norges Bank

Credit/GDP

Average (1976 Q1 − 2014 Q2)

Crises

(46)

2000 2002 2004 2006 2008 2010 2012 2014

−10 0 10 20 30

−10 0 10 20 30 Chart 3.2 Credit to households and non-financial enterprises and mainland GDP.

Four-quarter growth.

¹⁾

Percent. 2000 Q1 − 2014 Q2

1) Change in stocks at the end of the quarter.

2) Sum of C2 non-financial enterprises and foreign debt in mainland Norway.

Debt, non-financial enterprises (C3)

²⁾

Debt, households (C2)

Nominal GDP, mainland Norway

(47)

1994 1996 1998 2000 2002 2004 2006 2008 2010 2012 2014 0

10 20 30 40

0 50 100 150 200 250 Chart 3.3 Household debt-to-disposable income ratio.

¹⁾

Percent. 1994 Q1 − 2014 Q2

1) Loan debt as a percentage of disposable income, adjusted for estimated reinvested dividend income for 2000 – 2005 and redemption/reduction of equity capital for 2006 Q1 – 2012 Q3.

2) Change in stocks at the end of the quarter. Last observation on 2013 Q4.

Debt ratio (right-hand scale)

Four-quarter growth in household debt

²⁾

(left-hand scale)

Four-quarter growth in disposable income (left-hand scale)

(48)

2008 2009 2010 2011 2012 2013 2014

−80

−60

−40

−20 0 20 40 60 80

−80

−60

−40

−20 0 20 40 60 80 Chart 3.4 Changes in credit demand and banks’ credit standards preceding quarter, and expected change next quarter.

¹⁾

Households. Percent. 2007 Q4 − 2014 Q3

1) Negative figures denote lower demand or tighter credit standards.

Source: Norges Bank

Change in demand preceding quarter Next quarter

Change in credit standards preceding quarter Next quarter

(49)

1979 1983 1987 1991 1995 1999 2003 2007 2011 50

100 150 200

50 100 150 200 Chart 3.5 House prices

¹⁾

relative to disposable income

²⁾

.

Indexed. 1998 Q4 = 100. 1979 Q1 − 2014 Q2

1) Quarterly figures pre-1990 are calculated by linear interpolation of annual figures. House price index last quarter. Up to and including MPR 2/14, the house price indicator was calculated as an average of the house price index over the previous four quarters.

2) Adjusted for estimated reinvested dividend income for 2000 – 2005 and redemption/reduction of equity capital for 2006 Q1 – 2012 Q3.

Sources: Statistics Norway, Eiendom Norge, Norwegian Association of Real Estate Agents (NEF), Finn.no, Eiendomsverdi and Norges Bank

House prices/disposable income

Average (1979 Q1 − 2014 Q2)

Crises

(50)

2004 2006 2008 2010 2012 2014 0

20 40 60 80 100

0 5 10 15 20 25 Chart 3.6 Turnover and houses for sale.

Seasonally adjusted. In 1000s of dwellings. January 2004 − August 2014

Sources: Eiendom Norge, Finn.no and Eiendomsverdi

Turnover past 12 months (left-hand scale)

Houses for sale on Finn.no (right-hand scale)

(51)

2003 2005 2007 2009 2011 2013

−10 0 10 20 30 40 50

−10 0 10 20 30 40 50 Chart 3.7 Credit from selected funding sources to Norwegian non-financial

enterprises. Twelve-month growth.

¹⁾

Percent. January 2003 − July 2014

1) Change in stocks.

2) To end-June 2014.

Domestic bank debt Domestic notes and bonds

Foreign debt (mainland enterprises)

²⁾

(52)

2008 2009 2010 2011 2012 2013 2014

−80

−60

−40

−20 0 20 40 60 80

−80

−60

−40

−20 0 20 40 60 80 Chart 3.8 Changes in credit demand and banks’ credit standards preceding quarter, and expected change next quarter.

¹⁾

Enterprises. Percent. 2007 Q4 − 2014 Q3

1) Negative figures denote lower demand or tighter credit standards.

Source: Norges Bank

Change in demand preceding quarter Next quarter

Changes in credit standards preceding quarter Next quarter

(53)

2003 2005 2007 2009 2011 2013 0

20 40 60 80 100

0 20 40 60 80 100 Chart 3.9 Debt-servicing capacity

¹⁾

of listed companies.

Percent. 2003 Q1 − 2014 Q2

1) Pre-tax profit plus depreciation and amortisation for the previous four quarters as a percentage of interest-bearing debt for non-financial companies included in the OBX index (excluding Statoil).

Sources: Bloomberg, Statistics Norway and Norges Bank

(54)

2002 2004 2006 2008 2010 2012 2014 0

1000 2000 3000 4000 5000 6000 7000

4 6 8 10 12 14 Chart 3.10 Vacancy rates

¹⁾

and rental prices

²⁾

for office premises in Oslo.

Percent and NOK per square metre. 2002 H1 − 2014 H1

1) Number of square metres of vacant office premises as a percentage of total number of square metres.

2) Deflated by the GDP deflator for mainland Norway.

Sources: DNB Næringsmegling, OPAK, Dagens Næringsliv and Norges Bank

Office vacancy rates in Oslo, Asker and Bærum (right-hand scale)

Rental prices for prestigious, centrally located premises (left-hand scale)

Rental prices for high-standard, centrally located premises (left-hand scale)

Rental prices for older, inefficient premises (left-hand scale)

(55)

1981 1985 1989 1993 1997 2001 2005 2009 2013 50

100 150 200

50 100 150 200 Chart 3.11 Real commercial property prices.

¹⁾

Indexed. 1998 = 100. 1981 Q2 − 2014 Q2

1) Estimated market prices for office premises in Oslo deflated by the GDP deflator for mainland Norway.

Sources: Dagens Næringsliv, OPAK, Statistics Norway and Norges Bank

Real commercial property prices

Average (1981 Q2 − 2014 Q2)

Crises

(56)

1976 1980 1984 1988 1992 1996 2000 2004 2008 2012 0

10 20 30 40 50 60

0 10 20 30 40 50 60 Chart 3.12 Banks’

¹⁾

wholesale funding as a share of total assets.

²⁾

Percent. 1976 Q1 − 2014 Q2

1) All banks and covered bond mortgage companies in Norway excluding branches and subsidiaries of foreign banks in Norway.

2) Quarterly figures pre-1989 are calculated by linear interpolation of annual figures.

Source: Norges Bank

Wholesale funding/total assets

Average (1976 Q1 − 2014 Q2)

Crises

(57)

1992 1996 2000 2004 2008 2012 0

20 40 60 80

0 20 40 60 80 Chart 3.13 Decomposition of banks’

¹⁾

wholesale funding share.

As a percentage of total assets. 1991 Q4 − 2014 Q2

2) Deposits from credit institutions include deposits from central banks.

Source: Norges Bank

Short-term debt in NOK

Deposits from credit institutions in NOK Bonds in NOK

Other debt in NOK

Short-term debt in foreign currency

Deposits from credit institutions in foreign currency

²⁾

Bonds in foreign currency

Other debt in foreign currency

(58)

1 10 100 1000 10000 0

2 4 6 8 10 12 14 16 18

0 2 4 6 8 10 12 14 16 18 Chart 3.14 Banking groups’

¹⁾

Common Equity Tier 1 (CET1) capital ratios.

Percent. Total assets.

²⁾

In billions of NOK. At 30 June 2014

³⁾

1) Banking groups with total assets in excess of NOK 20bn, excluding branches of foreign banks in Norway.

2) Logarithmic scale.

3) Assuming that profits for 2014 H1 are added in full to CET1 capital.

Sources: Banking groups’ quarterly reports and Norges Bank

Systemically important banks

The largest regional savings banks Other large banks

CET1 requirement from 1 July 2016 including a countercyclical buffer of 1 percent

CET1 requirement from 1 July 2016 including a countercyclical buffer of

1 percent and a buffer for systemic importance of 2 percent

(59)

1 July 2013 1 July 2014 1 July 2015 1 July 2016 0

2 4 6 8 10 12 14 16

0 2 4 6 8 10 12 14 16

4.5 2.5 2.0

4.5 2.5 3.0

4.5 2.5 3.0 1.0 1.0

4.5 2.5 3.0 2.0 1.0 Chart 3.15 Common Equity Tier 1 capital requirements in the new regulatory framework. Percent. 1 July 2013 – 1 July 2016

Sources: Ministry of Finance and Norges Bank

Maximum countercyclical buffer Countercyclical buffer

Buffer for systemically important banks Systemic risk buffer

Conservation buffer

Minimum requirement

(60)

1983 1987 1991 1995 1999 2003 2007 2011

−30

−20

−10 0 10 20 30 40

−30

−20

−10 0 10 20 30 40 Chart 3.16a Credit gap. Total credit

¹⁾

mainland Norway as a share of mainland GDP. Deviation from estimated trends. Percentage points. 1983 Q1 − 2014 Q2

1) The sum of C2 households and C3 non-financial enterprises in mainland Norway (all non-financial enterprises pre-1995). C3 comprises C2 and foreign debt.

2) One-sided Hodrick-Prescott filter estimated on data augmented with a simple projection. Lambda = 400 000.

3) One-sided Hodrick-Prescott filter. Lambda = 400 000.

10-year rolling average Augmented HP filter

²⁾

One-sided HP filter

³⁾

Variation

Crises

(61)

1983 1987 1991 1995 1999 2003 2007 2011

−40

−30

−20

−10 0 10 20 30 40

−40

−30

−20

−10 0 10 20 30 40 Chart 3.16b House price gap. House prices

¹⁾

relative to disposable income

²⁾

. Deviation from estimated trends. Percent. 1983 Q1 − 2014 Q2

1) Quarterly pre-1990 figures are calculated by linear interpolation of annual figures.

2) Adjusted for estimated reinvested dividend income for 2000 – 2005 and redemption/reduction of equity capital for 2006 Q1 – 2012 Q3.

Sources: Statistics Norway, Eiendom Norge, Norwegian Association of Real Estate Agents (NEF), Finn.no, Eiendomsverdi and Norges Bank

Recursive average Augmented HP filter

³⁾

One-sided HP filter

⁴⁾

Variation

Crises

(62)

1983 1987 1991 1995 1999 2003 2007 2011

−40

−20 0 20 40 60 80

−40

−20 0 20 40 60 80 Chart 3.16c Commercial property price gap. Real commercial property prices

¹⁾

as deviation from estimated trends. Percent. 1983 Q1 − 2014 Q2

1) Estimated market prices for office premises in Oslo deflated by the GDP deflator for mainland Norway.

Sources: Dagens Næringsliv, OPAK, Statistics Norway and Norges Bank

Recursive average

Augmented HP filter

²⁾

One-sided HP filter

³⁾

Variation

Crises

(63)

1983 1987 1991 1995 1999 2003 2007 2011

−20

−15

−10

−5 0 5 10 15 20 25

−20

−15

−10

−5 0 5 10 15 20 25 Chart 3.16d Wholesale funding gap. Banks’

¹⁾

wholesale funding as a share of total assets.

²⁾

Deviation from estimated trends. Percentage points. 1983 Q1 − 2014 Q2

2) Quarterly figures pre-1989 are calculated by linear interpolation of annual figures.

Source: Norges Bank

10-year rolling average Augmented HP filter

³⁾

One-sided HP filter

⁴⁾

Variation

Crises

(64)

1983 1987 1991 1995 1999 2003 2007 2011 0

0.5 1 1.5 2 2.5 3 3.5

0 0.5 1 1.5 2 2.5 3 3.5 Chart 3.17 Reference rates for the countercyclical capital buffer under alternative trend estimates. Percent. 1983 Q1 − 2014 Q2

Buffer based on deviation from trend using augmented HP filter

¹⁾

Buffer based on deviation from trend using one-sided HP filter

²⁾

(65)

0 20 40 60 80 100 120

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 Housing starts

New home sales Existing-home sales

Chart 1 US housing market. Index. June 2005 = 100. January 2005 – July 2014

Source: Thomson Reuters

(66)

25 30 35 40 45 50 55 60

-3 -2 -1 0 1

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 GDP growth (left-hand scale) PMI (right-hand scale)

Chart 2 Euro area: Quarterly GDP growth. Percent. 2005 Q1 – 2014 Q2.

PMI Composite Output, three-month average. Diffusion index centred around 50.

January 2005 – August 2014

Source: Thomson Reuters

(67)

80 90 100 110 120

2007 2008 2009 2010 2011 2012 2013 2014

Total

Total excluding London Chart 3 UK house prices.

Index. January 2008 = 100. January 2007 – June 2014

Source: Office for National Statistics

(68)

-3 -2 -1 0 1 2 3

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 Domestic demand

Survey-based model

Chart 4 Sweden: Quarterly growth in domestic demand¹⁾. Percent. 2005 Q1 – 2014 Q2. Survey-based model²⁾. 2005 Q1 – 2014 Q3

1) Consumption, investment and change in inventories.

2) The survey-based model estimates trend growth in domestic demand based on developments in the ETI, PMI and ESI.

Sources: Thomson Reuters and Norges Bank

(69)

0 10 20 30 40 50 60 70 80

Jan-13 Apr-13 Jul-13 Oct-13 Jan-14 Apr-14 Jul-14

Fall No change Growth

Chart 5 China: House price developments for private dwellings in 70 cities.

Number of cities with growth, no change or fall in prices from previous month.

January 2013 – July 2014

Source: CEIC

(70)

-20 -10 0 10 20 30

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 Exports Imports

Chart 6 Exports and imports in emerging markets¹⁾.

Four-quarter change. Percent. 2005 Q1 – 2014 Q1

1) Brazil, Chile, Hungary, India, Indonesia, Mexico, Poland, South Africa and Turkey. GDP weights.

Sources: Thomson Reuters, IMF and Norges Bank

(71)

0 0.2 0.4 0.6 0.8 1

Norway¹ US UK Sweden Euro area

0 0.2 0.4 0.6 0.8 1 Chart 1 Goods exports to Russia as a percentage of GDP. 2013

1) Mainland exports as a percentage of mainland GDP.

Sources: Thomson Reuters, Statistics Norway and Norges Bank

(72)

−16 −12 −8 −4 0 4 8 12 16

−10

−8

−6

−4

−2 0 2 4 6

−10

−8

−6

−4

−2 0 2 4 6 Chart 1 Event history for household credit growth

¹⁾

around financial crises.

Deviation from normal times.

²⁾

Four-quarter growth. Percentage points

1) Credit is deflated by the consumer price index.

2) The chart shows average developments sixteen quarters before and sixteen quarters after a financial crisis relative to "normal times". Normal times are defined as all periods outside the window of the chart.

Source: Norges Bank

Credit to households

95% confidence interval

(73)

−16 −12 −8 −4 0 4 8 12 16

−8

−6

−4

−2 0 2 4 6 8 10

−8

−6

−4

−2 0 2 4 6 8 10 Chart 2 Event history for growth in credit

¹⁾

to non-financial corporations around financial crises. Deviation from normal times.

²⁾

Four-quarter growth. Percentage points

1) Credit is deflated by the consumer price index.

Source: Norges Bank

Credit to non-financial corporations

95% confidence interval

(74)

−16 −12 −8 −4 0 4 8 12 16

−10

−8

−6

−4

−2 0 2 4 6 8 10

−10

−8

−6

−4

−2 0 2 4 6 8 10 Chart 3 Event history for growth in house prices

¹⁾

around financial crises.

Deviation from normal times.

²⁾

Four-quarter growth. Percentage points

1) House prices are deflated by the consumer price index.

Source: Norges Bank

House prices

95% confidence interval

(75)

−16 −12 −8 −4 0 4 8 12 16

−1

−0.8

−0.6

−0.4

−0.2 0 0.2 0.4 0.6 0.8

−1

−0.8

−0.6

−0.4

−0.2 0 0.2 0.4 0.6 0.8 Chart 4 Event history for banks’ wholesale funding share around financial crises.

Deviation from normal times.

¹⁾

Quarterly change. Percentage points

Source: Norges Bank

Wholesale funding share

95% confidence interval

(76)

1980 1984 1988 1992 1996 2000 2004 2008 2012 0

0.1 0.2 0.3 0.4 0.5 0.6 0.7 0.8 0.9 1

0 0.1 0.2 0.3 0.4 0.5 0.6 0.7 0.8 0.9 1 Chart 5 Estimated crisis probabilities from various model specifications.

1980 Q1 − 2014 Q2

1) Model variation is represented by the highest and lowest crisis probability based on different model specifications and trend calculations.

Source: Norges Bank

Model variation

¹⁾