Mainland Norway witnesses solid growth in Q4 2018, surpasses Norges Bank’s expectations

Mainland Norway’s GDP increased by 0.9 percent from Q3 to Q4 2018. Norges Bank projected 0.7 percent in its December-MPR. Consensus (Bloomberg) expected 0.8 percent; growth in Q3 was revised up from 0.3 percent to 0.4 percent.

Total GDP rose by 0.5 percent from Q3 to Q4. Mainland business gross product rose by 1.2 percent q/q, while public sector only rose by 0.4 percent. Electricity production rose by 2.7 percent in Q4, and Mainland businesses excluding electricity rose by 1.1 percent in Q4 after a rise by 0.2 percent in Q3, DNB Markets reported.

Private consumption rose by 0.4 percent from Q3 to Q4, mainly due to an increase in consumption of services. Public consumption rose by 0.1 percent. Gross investments fell by 0.8 percent q/q in Q4. Oil investments rose by 4.3 percent, while investments in mainland businesses fell by 1.8 percent. House investments rose by 0.1 percent.

Exports of traditional goods rose by 4.9 percent q/q in Q4 and total imports fell by 1.0 percent. Net exports added to growth by 0.5 percentage point. Mainland GDP rose by 2.2 percent from 2017 to 2018, but the growth rate was affected by a decline in the number of working days.

Seasonally adjusted figures, capturing the change in working days, showed a rise by 2.5 percent from 2017 to 2018. Employment rose by 1.5 percent from 2017 to 2018 and the productivity rose by 0.6 percent. Annual wage growth is calculated to 2.8 percent in 2018, while the central bank forecasted 2.7 percent.