Norwegian mainland GDP growth drops in August, Norges Bank likely to hike interest rate in March 2019

Norwegian mainland GDP dropped 0.2 percent sequentially in August and slowed to 0.6 percent three-month-on-three month, compared to 0.8 percent in July. The decline in August was due to subdued agricultural production following a dry summer and a decline for fishery after strong growth the previous month.

The month GDP figures are expected to fluctuate, noted DNB Market in a research report. Overall, the Norwegian economic growth continues to be strong, underpinning gradual rate hikes. Norges Bank is expected to hike the interest rate to 1 percent in March 2019.

The monthly national accounts data indicated that the mainland GDP growth dropped 0.2 percent sequentially in August. Private consumption rose 1.2 percent, while public consumption dropped 0.1 percent and gross investments dropped 0.5 percent. Exports of traditional goods were up 14.5 percent in August, while imports of traditional goods dropped 4.6 percent. The total GDP fell 0.1 percent. Total exports were up 4.6 percent, while total imports dropped 3.5 percent.

The three-month moving average indicated that Mainland Norway’s growth slowed to 0.6 percent in August from 0.8 percent. Private consumption was up 0.2 percent, while public consumption rose 0.4 percent and gross investments dropped 0.2 percent. Total GDP rose 1.1 percent, while total exports rose 0.7 percent and total imports dropped by 2.8 percent.