Do we need a clean cut as much now? – OBI Online

Retail sales exceeded all expectations in May, after several weak months.

Today’s figures from Statistics Norway showed an increase of 1.7 percent, far above the consensus of 0.4 percent.

goods consumption rose less

Handelsbanken is not convinced about the strength in numbers.

– the broader index of commodity consumption, which leads directly into GDP calculations, rose a more modest 0.8 percent in May . The details reveal that the most was electricity consumption that held it again, writes senior economist Marius Gonsholt Hov in a so-called “permanent comment”.

He shows that the Bank has not yet put forward a detailed track of household consumption, only annual average.

– in the monetary policy report in June estimated the bank an increase in private consumption (goods and services) of 1.46 percent this year. This means that the bank estimates a quarterly increase of (some of) 0.3 percent ahead. It should be noted that household consumption of services continues to exceed consumption of goods, and we believe it will continue so, writes Gonsholt Hov.

How strong are the numbers?

Senior Economist think Norway Bank has baked into a quarterly growth of 0.6-0.7 percent for service consumption.

– This provides 0.0 to 0.1 percent quarterly growth in household consumption. Right now pointing monthly figures for household consumption compared to minus 0.1 percent in Q2. However, since a significant proportion of this weakness is due to electricity consumption, the “core items” more solid than what can be read out of the current figures, he said further.

– At first glance, the numbers seem to be stronger than Norges Bank has estimated. In addition forbrukersentimentet improved. Does this mean a solid comeback for consumption ahead? Depends Gonsholt Hov.

The answer is that he is still skeptical.

– First and foremost, sentiment will be negative again after the British referendum. Moreover, it was fundamental for consumption, even before the referendum, little changed. Unemployment stuck at high levels, and expectations for wage growth is negative, enter Gonsholt Hov.

– Do not fall off the cliff

Chief Economist Frank Jullum Danske Bank Markets shows opposite TDN Finans also the high volatility in the numbers.

– figures removes the risk that consumption was about to fall off the cliff, and shows that there is statistical noise that has marked the numbers in recent months. The downward trend is probably slightly broken, he said.

His peers in SEB, Stein Bruun, thinks it’s worth noting that Opinion monthly indicator of consumer confidence has risen sharply in recent months.

– The depressive mood among consumers is about to disappear, he said to the news agency.

Bruun do not think today’s numbers have something to say for Norges Bank’s setting forward – unlike senior economist Øystein Børsum in Swedbank.

– the numbers may indicate a less need for rate cuts, and that Norges Bank will be more cautious going forward, says the latter to TDN Finans.