Norwegian registered unemployment dropped in October by 100 persons on a seasonally adjusted basis, as compared with the expectations of a fall by 500. The downward trend in unemployment has decelerated considerably and unemployment is higher than expected. Nevertheless, compared to the central bank, the development since the September report has been marginally on the solid side, but far from enough to have any effect on Norges Bank’s view on rates, said Nordea Bank in a research report.
The short term outlook seems good. Partially because oil investment is growing solidly and partly because of the soft NOK. Growth in manufacturing is expected to decelerate next year when these tailwinds lose momentum.
“After zero real wage growth last year, this year it will be above 1 percent and probably between 1½ percent and 2 percent next year. Add to this that employment grows by between 1½ and 2 percent and the outlook for household income and optimism is good”, added Nordea Bank.
