Executive Board Meeting
4 December 2013
-4 -2 0 2 4
-4 -2 0 2 4
2008 2010 2012 2014 2016
Output gap
-1 0 1 2 3 4 5
-1 0 1 2 3 4 5
2008 2010 2012 2014 2016
CPI-ATE
-1 0 1 2 3 4 5
-1 0 1 2 3 4 5
2008 2010 2012 2014 2016
CPI
0 1 2 3 4 5 6 7
0 1 2 3 4 5 6 7
2008 2010 2012 2014 2016
Key policy rate
Baseline scenario in MPR 4/13
Percent. 2008 Q1 – 2016 Q4
30%
50%
70%
90%
Sources: Statistics Norway and Norges Bank
0 1 2 3 4 5 6
0 1 2 3 4 5 6
2008 2010 2012 2014 2016
Key policy rate
-2 -1 0 1 2 3 4
-2 -1 0 1 2 3 4
2008 2010 2012 2014 2016
Output gap
0 1 2 3 4
0 1 2 3 4
2008 2010 2012 2014 2016
CPI-ATE
Criterion 1 Criteria 1&2 Criteria 1,2&3
Criteria for an appropriate interest rate path
Percent. 2008 Q1 – 2016 Q4
Sources: Statistics Norway and Norges Bank
Factors behind changes in the interest rate forecast since MPR 3/13
Accumulated contribution. Percentage points. 2014 Q1 – 2016 Q4
Source: Norges Bank
-2 -1 0 1 2
-2 -1 0 1 2
2014Q1 2014Q3 2015Q1 2015Q3 2016Q1 2016Q3
Money market premiums Lending spreads
Exchange rate Interest rates abroad
Prices Foreign demand
Costs Capacity utilisation
Change in the interest rate forecast
3-month money market rate in the baseline scenario¹ ) and estimated forward rates² )
Percent. 2008 Q1 – 2016 Q4
Sources: Thomson Reuters and Norges Bank
0 1 2 3 4 5 6 7 8
0 1 2 3 4 5 6 7 8
2008 2009 2010 2011 2012 2013 2014 2015 2016
Estimated forward rates MPR 3/13 Estimated forward rates MPR 4/13
Money market rate in the baseline scenario MPR 3/13 Money market rate in the baseline scenario MPR 4/13
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 and red bands show the highest and lowest forward rates in the period 30 August – 12 September 2013 and 18 - 29 November 2013.
-6 -4 -2 0 2 4 6
-6 -4 -2 0 2 4 6
2008 2009 2010 2011 2012 2013 2014 2015 2016
MPR 3/13 MPR 4/13
GDP for trading partners
Volume. Four-quarter change. Percent. 2008 Q1 – 2016 Q4
Sources: Thomson Reuters and Norges Bank
Financial markets
0 1 2 3 4 5 6 7 8
0 1 2 3 4 5 6 7 8
2010 2011 2012 2013
US UK Spain
Italy Germany
MPR 3/13
Source: Bloomberg
80 90 100 110 120 130 140
80 90 100 110 120 130 140
Germany (DAX) Spain (IBEX) Italy (FTSE MIB) US (S&P 500)
MPR 2/13
MPR 3/13
Equity markets
1 January 2013 = 100. 1 January – 2 December 2013
MPR 2/13
Yields on 10-year government bonds
Percent. 1 January 2010 – 2 December 2013
Expected key rates
Percent. 1 January 2010 – 31 December 2016
1)Sources: Bloomberg and Norges Bank
0 1 2 3
0 1 2 3
2010 2011 2012 2013 2014 2015 2016
US
Euro area² ⁾ Sweden UK
1) Broken lines show estimated forward rates at 12 September 2013. Thin lines show forward rates at 2 December 2013. Forward rates are based on Overnight Index Swap (OIS) rates. Daily data from 1 January 2010 and quarterly data from 2014 Q1
2) EONIA for the euro area from 2014 Q1
Prices for coal, crude oil and natural gas
USD per MMBTU
1). January 2005 – December 2015
Sources: IMF, Thomson Reuters, Statistics Norway, Ministry of Finance and Norges Bank
0 5 10 15 20 25
0 5 10 15 20 25
2005 2007 2009 2011 2013 2015
Coal US Oil Gas UK Gas US Gas Russia Gas Norway Futures prices
1) Million British Thermal Unit
Sources: Thomson Reuters and Norges Bank 1) Three-month money market rate differential between Norway and trading partners
2) A positive slope denotes a stronger krone exchange rate
-2 -1 0 1 2 3 4 5 80
85
90
95
100
105
2004 2006 2008 2010 2012 2014 2016
I-44 (left-hand scale)
3-month rate differential (right-hand scale)
Interest rate differential 1) and import-weighted exchange rate index (I-44) 2)
January 2004 – December 2016
0 1 2 3 4 5 6
0 1 2 3 4 5 6
2010 2011 2012 2013 2014 2015 2016
Key policy rate
3-month money market rate Household lending rates 1)
Interest rate projections
Percent. 2010 Q1 – 2016 Q4
Sources: Statistics Norway and Norges Bank 1) Average interest rate on all loans to households from
banks and mortgage companies
Output growth
Past 3 months and expected growth next 6 months. Annualised.
Percent. 2003 Q1 – 2014 Q2
-6 -4 -2 0 2 4 6 8 10 12 14
-6 -4 -2 0 2 4 6 8 10 12 14
2003 2005 2007 2009 2011 2013
Mainland GDP growth Regional network
12 Sources: Statistics Norway and Norges Bank
Norges Bank’s regional network– output growth
Actual growth past 3 months. Annualised. Percent.
October 2002 – October 2013
-6 -4 -2 0 2 4 6 8 10
-6 -4 -2 0 2 4 6 8 10
2002 2005 2007 2010 2012
Construction Retail trade Manufacturing Services
-6 -4 -2 0 2 4 6 8 10
-6 -4 -2 0 2 4 6 8 10
2002 2004 2007 2009 2012
Export industry
Oil industry suppliers 1)
Domestically oriented manufacturing
Source: Norges Bank’s regional network 1) Norwegian continental shelf
Regional network
2005 Q1– 2013 Q4
10 20 30 40 50 60 70 80
10 20 30 40 50 60 70 80
2005 2007 2009 2011 2013
Capacity constraints Labour supply 1)
1) Share of contacts that will have some or considerable problems accommodating an increase in demand and the share of contacts where output is constrained by labour supply
Unemployment rate
Seasonally adjusted.
January 2006 – November 2013
Sources: Statistics Norway, NAV and Norges Bank
1 2 3 4
1 2 3 4
2006 2008 2010 2012
NAV LFS
Projections for subcomponents of GDP
Annual change. Percent
-1 1 3 5 7 9 11 13 15
-1 1 3 5 7 9 11 13 15
2012 2013 2014
Average 2002-2012
Sources: Statistics Norway and Norges Bank
Index of household consumption of goods
Seasonally adjusted. January 2007 – October 2013
100 105 110 115 120 125 130 135 140
100 105 110 115 120 125 130 135 140
Jan-07 Jan-08 Jan-09 Jan-10 Jan-11 Jan-12 Jan-13
Sources: Statistics Norway
0 2 4 6 8
0 2 4 6 8
2003 2005 2007 2009 2011 2013 2015
Household consumption
Household real disposable income
Household consumption and real disposable income
Annual change. Percent. 2003 - 2016
Sources: Statistics Norway and Norges Bank
CPI-ATE
12-month change. Percent. January 2009 – March 2014
-2 -1 0 1 2 3 4
-2 -1 0 1 2 3 4
2009 2010 2011 2012 2013 2014
Domestically produced goods and services Imported consumer goods
CPI-ATE
Sources: Statistics Norway and Norges Bank
0 1 2 3
0 1 2 3
Mar-11 Sep-11 Mar-12 Sep-12 Mar-13 Sep-13 Mar-14
CPI-ATE MPR 4/13 SAM
30% 50% 70% 90%
CPI-ATE
Actual developments, baseline scenario and projections from SAM
1). Four-quarter change. Percent. 2011 Q1 – 2014 Q1
Sources: Statistics Norway and Norges Bank 1) System for averaging short-term models
0 1 2 3 4 5 6 7
0 1 2 3 4 5 6 7
2008 2009 2010 2011 2012 2013 2014 2015 2016
MPR 3/13 MPR 4/13
30% 50% 70% 90%
Key policy rate
Fan chart from MPR 3/13. Percent. 2008 Q1 – 2016 Q4
Source: Norges Bank
