Fall in Norwegian unemployment decelerates slightly in February

The decline in Norwegian unemployment decelerated slightly in February. However, the downward trend continues to be solid and the level below Norges Bank’s forecast. Registered unemployment including those on labor market measures dropped by 600 persons in February after falling by 2400 last month. The unadjusted rate came in at 2.5 percent, coming in line with consensus expectations and the central bank’s projections.

There has been slight noise in the registered unemployment figures lately, and on average it is down 1100 persons a month. In line with the trend last year, the downward trend remains in place.

The fall in unemployment was consistent with Norges Bank’s projection. Still because of the sharp decline last month the level is still below Norges Bank. Seasonally adjusted jobless rate came in at 2.35 percent as compared with Norges Bank’s projection of 2.42 percent.

That, along with clear signs that employment is growing faster than anticipated, underpins an upward revision of the output gap in the coming March Monetary policy report. That, together with oil investment survey on the upside and higher expected rates abroad, argue for a higher rate path at least long out, noted Nordea Bank in a research report.

“But we are more uncertain of whether there will be any change in the forecast for rates in 2018, which is what counts for the market, after today’s figure. Next week’s key figures will be crucial”, added Nordea Bank.

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