Norwegian registered unemployment falls in August, Norges Bank likely to hike in September

Norwegian labor market figures came in slightly weak in August. However, Norges Bank is expected to hike interest rate in September. Norway’s registered unemployment including those on labor market measures dropped by 2400 persons in August after the surge in July. That was slightly below expectations of a fall of 3000.

Taking into account that a new registration routine possibly pulled up the last figures, unemployment has moved about sideways in the summer. Through 2017 and early 2018 unemployment fell by between 1000 and 1500 persons a month.

With oil investment soon beginning to increase and a slowing of the downward trend in house building, growth and thus employment is expected to grow strongly in the year ahead. This signifies a tighter labor market, noted Nordea Bank in a research report.

However, for now, the Norwegian central bank will conclude that unemployment appears to be leveling out at a slightly higher level than expected. It projects a leveling out at 2.1 percent while seasonal adjusted is expected to come in at 2.3 percent.

“Add to this that that the employment figure for Q2 was somewhat on the weak side. Not that it will prevent a September hike and given the combination of a very weak NOK and continued high oil price an upward revision of the path still seems likely”, added Nordea Bank.