Then Norges Bank says “Stop”, the investment bank believes.
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Table of Contents
- DNB Carnegie expects Norges Bank to cut interest rates in September and March, but then pauses the interest rate due to inflation and higher wage growth.
- They predict growth for the Norwegian mainland economy, with private consumption as a main driver for this.
- American 15 per cent customs on Norwegian exports will have a limited effect on the mainland economy, says DNB Carnegie.
The summary is made by the AI tool Chatgpt and quality assured by E24’s journalists
– We expect Norges Bank to cut interest rates in September and March, before it becomes a break, as resistant inflation and high wage growth limit the scope for further cuts, DNB Carnegie writes in its half -year report.
The key policy rate is currently 4.25 per cent. With two cuts it will be 3.75 percent before Easter.
In July, the core inflation in Norway received 3.3 per cent. Norges Bank aims for a core inflation of 2 per cent over time, in combination with low unemployment.
DNB Carnegie believes inflation will come in at 2.9 per cent in 2025, 2.5 per cent in 2026, and 2.6 per cent in 2027 and 2028.
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In July, unemployment increased to 2.2 per cent from 2 per cent in June.
DNB Carnegie believes unemployment will remain stable, before it will gradually fall in line with higher economic growth and reach 2 per cent in 2028.
Better times
DNB Carnegie predicts progress for Norwegian mainland economymainland economyThe economy when ignoring oil and gas extraction and exports, as well as foreign shipping. In the years to come.
In the first quarter step BNPBNPGross domestic product (GDP) is the total production in a country. It is expressed as the total value of all goods and services sold to end users. GDP can be used as an indicator of value creation over time and between countries. With 1 percent, after a disappointing fourth quarter in 2024. DNB Carnegie further believes in moderate growth in the second quarter, before it takes up in the second half of the year and gets the GNP in to an increase of 1.3 percent.
They expect a further increase of 1.5 and 1.8 per cent in 2026 and 2027 respectively.
– We see Private ConsumPrivate ConsumPrivate persons or household consumption. As a significant driver for growth in 2025 and 2026, as improved wage growth and interest rate cuts improve households’ disposable income, writes DNB Carnegie.
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When it comes to the parliamentary elections on September 8, DNB Carnegie believes that the outcome will have little to say. This is because they experience a broad consensus on the main framework for public expenses.
– The absence of larger reform proposals reinforces this, writes DNB Carnegie, and continues:
– Possible changes in wealth tax may affect statistical indicators, but it is unlikely that this will significantly change our view of Norway’s growth opportunities over the next four years.
The US-Toll has little to say
DNB Carnegie writes that one is starting to see the contours of a new framework for international trade, after we have traveled a period of major changes in US trade policy and fluctuations in the markets.
They expect the US central bank to come with three interest rate cuts by the end of 2025.
US interest rate cuts can also affect Norges Bank to do the same.
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The United States has placed a 15 percent tariff against Norway.
DNB Carnegie predicts that this will have consequences for affected sectors, but says that the mainland economy as a whole is not vulnerable to decline in exports to the United States.
This is due to the low export share: Norway’s exports to the United States make up around three per cent of total goods exports, and salmon and petroleum products make up much of these percentage.
– Furthermore, our prospects for the eurozone indicate increased economic growth and increased investments in the years to come, which is a positive factor given the large proportion of Norwegian exports going to the eurozone, writes DNB Carnegie.
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