Norway business activity rises, bottlenecks emerge

FILE PHOTO: Norwegian flags flutter at Karl Johans street in Oslo, Norway
FILE PHOTO: Norwegian flags flutter at Karl Johans street in Oslo, Norway, May 31, 2017. REUTERS/Ints Kalnins/

September 14, 2021

OSLO (Reuters) – Norwegian business sector activity has increased substantially during the past three months and will continue to expand during the next half year, a central bank business survey showed on Tuesday.

“At the same time, close to half of the contacts are facing capacity constraints,” the central bank said in a statement.

Norges Bank is widely expected to raise interest rates at a monetary policy meeting next week, from a record low 0%, and has said https://www.reuters.com/business/finance/breaking-ranks-norway-signals-4-rate-hikes-by-mid-2022-2021-06-17 it may hike three times more by mid-2022 if the economy develops as expected.

“Contacts report higher output growth in all sectors over the past three months. The rise has been most pronounced in manufacturing and household services,” Norges Bank said in a statement accompanying the quarterly sentiment index.

The Norwegian economy has accelerated thanks to a gradual lifting of COVID-19 restrictions, and policy-makers and analysts expect above-trend growth for several more years.

Norway’s crown currency traded largely unchanged on the news at 10.17 against the euro at 0810 GMT.

(Reporting by Terje Solsvik, editing by Gwladys Fouche)