Norwegian economy is better than expected – OBI Online

GDP for Mainland Norway rose by a seasonally adjusted 0.4 per cent in Q2 2016, according to figures from Statistics Norway on Wednesday.

This came after zero growth in the second half of last year, followed by an increase in 1 . quarter of 0.3 percent.

the consensus was for 0.3 percent growth in the mainland economy.

– Norges Bank’s estimate and the market consensus was 0.3 percent and significantly higher than the regional network report that indicated a flat growth. Growth is also higher than what we had seen for ourselves, as we considered the risk of a surprise on the downside to be greater than the potential for a surprise on the upside, says chief economist Shakeb Syed Sparebank 1 Markets.

on an annual basis, the figures show growth in the mainland economy of 1.7 percent. In Q1 growth was negative by 0.9 percent. Overall, the increase in GDP of 2.5 percent from Q2 last year.

Shipyards a bright spot

Electricity production fell noticeably in Q2 after a strong rise the previous quarter. The decline helped push down growth in mainland Norway by 0.1 percentage points.

For the manufacturing industries in total, the preliminary seasonally adjusted figures show a reduction in value added of 0.9 percent in Q2 2016.

This is a somewhat larger decline than in Q1, but the decline has slowed clearly in strength compared with last year.

in oil-related manufacturing industries is mixed: decline in some industries and rising others, including in the shipbuilding industry.

During production industries continued the clear growth in construction, while traditional fishing and fish farming dropped something.

Active in tourism

for the service sector was also mixed.

the preliminary figures show growth in including services related to oil operations and merchandising. Hotels and restaurants in Q2 showed high activity despite hotel strike in May. Business Fiscal services continued decline.

Value added in both extraction and pipeline transport, oil and gas and shipping declined in Q2 and contributed to the total GDP was unchanged from Q1.

from the 4th quarter of last year to the 1st quarter GDP rose a total of 1.0 percent.

on an annual basis shows total GDP growth of 2.5 percent, up from 0.6 percent in 1. quarter.

More to purchases

Household consumption rose 0.4 percent in Q2, following growth of 0.6 percent in the previous two quarters. Consumer spending was unchanged from Q1 to Q2, while spending on services increased.

Household investment in housing has risen steadily since late 2014, and rose 2.3 percent in Q2, 2016.

Total gross fixed capital formation by 0.1 per cent in Q2 this year after having mostly fallen over the last two years.

Preliminary figures show a continued decline in petroleum investment, particularly in exploration and production drilling while platform investments increased. The overall decline of as much as 3.7 percent was still clearly lower than in Q1.

Investment Growth

For mainland Norway was the growth in investment – primarily in service industries . In industry, investments were reduced by 1.2 percent, after a clearer decline in Q1.

Exports of traditional goods in volume by 0.4 per cent less than in Q1, after a marked decline in quarter.

Traditional merchandise imports fell by 2.4 percent after a decline also in the previous quarter. This reflects the SSB weak growth in import intensive Norwegian demand and improved competitiveness.

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