Norway: Weaker outlook on capacity limits – Danske Bank

In view of Danske Bank analysts, Norway’s growth has disappointed but remains above trend and there is the prospect of lower growth next year.

Key Quotes

“The slowdown is broad based but the weakness in retail trade is more pronounced and the abrupt halt in construction took us by surprise.”

“Unemployment has bottomed out and employment growth has peaked.”

“However, wage growth seems to be picking up and may actually be higher than we previously expected.”

“Inflation has slowed as expected.”

“Norges Bank kept rates at 1.50% in December and appears to be on hold for a time. We still expect a rate hike in 2020.”

“The NOK has weakened since we published Nordic Outlook, 1 October, mainly on higher global risk. As risk has turned, we expect the NOK to strengthen in 2020.”