Moderate growth in the Norwegian economy continues
Growth in the gross domestic product (GDP) for mainland Norway was 0.5 per cent in the 2nd quarter of 2018. The Norwegian economy continues to show moderate growth.
Figure 1. Gross domestic product. Seasonally adjusted. Volume indices. 2016=100
|Gross domestic product||Gross domestic product, Mainland-Norway|
Figure 2. Gross fixed capital formation and consumption. Seasonally adjusted. Volume indices. 2016=100
|Gross fixed capital formation, Mainland-Norway||Consumption in households|
The growth in mainland GDP is mainly due to increased service production, especially retail trade, business services and information technology. Overall, private service production increased by 1.1 per cent in the 2nd quarter following a 0.7 per cent growth in the three previous quarters. Activity in public administration increased by 0.5 per cent, approximately the same as in the previous quarter.
Construction also made a positive contribution to the rise in the mainland economy. Low production in power supply dampened the growth in mainland GDP by almost 0.2 percentage points in the 2nd quarter.
For manufacturing and mining, the preliminary figures show a slight increase in the 2nd quarter after a clear fall in the 1st quarter. The activity in most industries was at the same level as in the 1st quarter, with the exception of the food industry, which helped to boost growth.
Activity in the petroleum sector fell 0.7 per cent in the 2nd quarter. Overall, GDP increased by 0.4 per cent, compared with 0.2 per cent in the 1st quarter.
Clear growth in household consumption
Household consumption increased 1.0 per cent, following a zero growth in the previous quarter. Commodity consumption increased by 1.5 per cent in the 2nd quarter, mainly due to increased car purchases and increased food consumption. Reduction in consumption of electricity and fuels reduced commodity consumption by 0.9 percentage points and total consumption by 0.4 percentage points.
Service consumption shows stable growth and increased by 0.7 per cent in the 2nd quarter.
Public consumption increased by 0.4 per cent in the 2nd quarter.
Gross fixed capital formation in mainland Norway increased by 4.1 per cent in the 2nd quarter following a decline in the previous quarter. Investments in the production and distribution of electricity explained a large part of the increase, but manufacturing investments were also responsible. Gross government investment in general government increased by 8.5 per cent, and most of this growth is attributable to the delivery of three new combat aircraft in the 2nd quarter.
Investments in dwellings saw a continued decline for the third consecutive quarter, but this must be seen in the context of high housing investments, which have had almost continuous growth from early 2015.
Petroleum investments increased by 13.1 per cent in the 2nd quarter after a decline in the previous quarter. Investments in the 2nd quarter were at the same level as the 4th quarter of 2017. In total, gross investment in fixed capital increased by 5.4 per cent.
Increased exports and imports
Exports of goods and services increased by 1.5 per cent in the 2nd quarter, particularly the export of gas. Exports of traditional goods increased by 0.5 per cent after an approximately equal decrease in the 1st quarter. Increased exports of manufacturing products explained much of the growth. Preliminary figures show growth in exports of services for the second quarter in a row.
Imports increased by 4.3 per cent in the 2nd quarter, with growth in imports of both traditional goods and services.
Lower employment growth
Preliminary calculations show that employment adjusted for seasonal variations increased by 0.3 per cent, or about 7 700 in the 2nd quarter. This was slightly weaker than the 0.5 per cent growth in the 1st quarter. Slowed growth rates can primarily be attributed to weaker growth in employment in public administration. Some industries that have grown a lot over a long period of time, such as the construction industry and business services, also had slightly weaker growth in the 2nd quarter than in the 1st quarter. Growth in these industries was nevertheless high.
Figures for all quarters back to 2016 have been revised
In connection with the release of figures for the 2nd quarter of 2018, the base year is updated with new information from the final national accounts for 2016. In addition, new information has been incorporated for all quarters starting in the 1st quarter of 2017. The new figures for 2016 and 2017 show growth in mainland Norway GDP of 1.1 and 2.0 per cent respectively. For both years, this corresponds to an upward adjustment of 0.1 percentage point. Seasonally adjusted growth in mainland Norway GDP through 2017 has been slightly revised as a result of the new information, while growth in the 1st quarter of 2018 has been revised downwards by 0.2 percentage points. There will be a separate article explaining the revision of the annual figures for 2016 and 2017.
An overview of the revisions in macroeconomic variables is given in Appendix table no. 8. For an overview of developments in the gross domestic product for some of our trading partners, see OECD’s statistics.