Norges Bank 1 Executive Board Meeting 22 September 2004

Norges Bank

1

Executive Board Meeting 22 September 2004

Norges Bank

2

Interest and exchange rate assumptions and projections for the CPI adjusted for tax changes and excluding energy products (CPI-ATE) and the output gap in Inflation Report 2/04. Per cent

-2

-1

0

1

2

3

2002 2003 2004 2005 2006 2007-2

-1

0

1

2

3

CPI-ATE

Output gap

85

90

95

100

105

2002 2003 2004 2005 2006 2007

0

2

4

6

8

10

Money market rate (right-hand scale)

Source: Norges Bank

Krone exchange rate, I-44 (left-hand scale)

Sources: Statistics Norway and Norges Bank

Norges Bank

3

GDP growthGrowth in volume from previous quarter. Seasonally adjusted

-1

-0.5

0

0.5

1

1.5

2

2002 2003 2004

-1

-0.5

0

0.5

1

1.5

2

2002 2003 2004

Sources: EcoWin / US Dept. of Commerce, SCB, National Statistics, EUR-OP / EUROSTAT and Norges Bank

Euro area

Japan

UK

US

Sweden

Norges Bank

4

Yields on 10-year government bonds 1 Jan 04 – 20 Sep 04

3.0

3.5

4.0

4.5

5.0

Jan Feb Mar Apr May Jun Jul Aug Sep

3.0

3.5

4.0

4.5

5.0

Sources: Bloomberg and Norges Bank

Norway

Germany

USSince previous monetary policy meeting

Norges Bank

5

35

40

45

50

55

60

65

1998 1999 2000 2001 2002 2003 2004

35

40

45

50

55

60

65

PMI Manufacturing in the US1), the euro area and Sweden. Seasonally adjusted. Monthly figures

Sources: EcoWin / ISM-Institute for Supply Management, NTC Research Ltd. and Swedbank / I&L

Euro area Sweden

US

1) ISM, Manufacturing

Norges Bank

6

Core CPI/HICP in the US, the euro area and the UK12-month rise. Per cent. Jan 01 – Aug 04

0

1

2

3

4

2001 2002 2003 2004

0

1

2

3

4

Source: EcoWin / National statistics

UK

US1)

Euro areaUS2)

1) CPI 2) Personal consumption expenditure deflator, excluding food and energy

Norges Bank

7

Interest rate expectationsActual developments and expected key rate on 20 September

0

1

2

3

4

5

6

Mar-03 Sep-03 Mar-04 Sep-04 Mar-05 Sep-05 Mar-06

0

1

2

3

4

5

6

US

Sweden

Euro area

UK

Sources: Reuters and Norges Bank

Norges Bank

8

Oil price Brent BlendUSD per barrel. Daily figures. Jan 02 – Jul 07

0

5

10

15

20

25

30

35

40

45

2002 2003 2004 2005 2006 20070

5

10

15

20

25

30

35

40

45

Sources: Telerate, IPE and Norges Bank

11 August

Futures prices 24 June (IR 2-04)

16 September

Norges Bank

9

Real oil price in 2004 USD1) and nominal oil price Deflated by US CPI. Monthly figures. Brent Blend in dollars per barrel

0

20

40

60

80

100

120

1970 1974 1978 1982 1986 1990 1994 1998 2002

0

20

40

60

80

100

120

Oil price in 2004 USD

Nominal oil price

1) The nominal oil price is deflated by mean CPI in the US in the period Jan 04 – Jul 04

Sources: EcoWin / Bureau of Labor Statistics and Norges Bank

Norges Bank

10

CPI-ATE12-month rise. Per cent. Jul 03 – Aug 04 Projections from Inflation Report 2/04 Jun 04 – Dec 04 (broken line)

-6

-4

-2

0

2

4

Jul-03 Oct-03 Jan-04 Apr-04 Jul-04 Oct-04

-6

-4

-2

0

2

4


Goods and services produced in Norway

Imported consumer goods

CPI-ATE

Norges Bank

11

Expert projections of consumer price inflation Per cent. Quarterly figures. Q2 2002 – Q3 2004

0

1

2

3

4

Jun-02 Dec-02 Jun-03 Dec-03 Jun-04

0

1

2

3

4

In 2 years

In 5 years

Source: TNS Gallup

Norges Bank

12

85

90

95

100

105

Jan-02 Jul-02 Jan-03 Jul-03 Jan-04 Jul-04

85

90

95

100

105

1) A rising curve denotes a stronger krone exchange rate

Source: Norges Bank

Developments in the krone exchange rate1) (I-44) Daily figures. 1 Jan 02 – 21 Sep 04

Since previous monetary policy meeting

Norges Bank

13

Expected change in key rates according to the swap market and expected difference against the mean of trading partners’ key rates. Sep 04 – Dec 06

-1

0

1

2

3

4

Aug-04 Dec-04 Apr-05 Aug-05 Dec-05 Apr-06 Aug-06 Dec-06

-1

0

1

2

3

4

Sources: Reuters and Norges Bank

20 September

10 August

Expected difference against the mean of trading partners’ key rates

Expected key rate

Norges Bank

14

GDP Mainland NorwayChange from previous quarter. Contribution to volume growth in percentage points. Seasonally adjusted

-3

0

3

6

-3

0

3

6

01:4 02:1 02:2 02:3 02:4 03:1 03:2 03:3 03:4 04:1 04:2

Private consumption Public consumptionPrivate investment Public investmentChanges in stocks and stat. discr.* Net exports Mainland Norway*GDP Mainland Norway


*Norges Bank estimates

Norges Bank

15

Main economic aggregates in quarterly national accounts and projections in Inflation Report 2/04


Annual growth 2004 Projections in IR

2/2004

Growth from first half-year in 2003

to first half-year in 2004

GDP Mainland Norway 3½ 3,7

Private consumption 5¼ 4,9

Gross investments Mainland Norway 3¾ 2,4

Petroleum investment 10 11,6

Traditional exports 5¼ 2,5

Imports 7½ 6,0

Norges Bank

16

Index of commodity consumption 1995 = 100. Seasonally adjusted volume. Jan 02 – Jul 04

118

121

124

127

130

133

136

139

142

Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec

118

121

124

127

130

133

136

139

142

20032004

Source: Statistics Norway

2002

Norges Bank

17

20000

30000

40000

50000

60000

70000

80000

90000

May Aug Nov Feb May Aug Nov Feb

20000

30000

40000

50000

60000

70000

80000

90000

Estimated and accrued investment costs for oil and gas extraction and pipeline transport In millions of NOK


2002

2003

20042005

Previous year Current year Final figures

Norges Bank

18

2,240

2,250

2,260

2,270

2,280

2,290

2,300

2,310

2,320

Dec Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec

2,240

2,250

2,260

2,270

2,280

2,290

2,300

2,310

2,320

Employment (LFS)Seasonally adjusted. In 1000s

2002

2003


2004

Norges Bank

19

Registered unemployed and job vacancies Seasonally adjusted. Jan 98 – Aug 04

0

300

600

900

1,200

1,500

1998 1999 2000 2001 2002 2003 2004

0

15,000

30,000

45,000

60,000

75,000

90,000

105,000

120,000

Job vacancies, trend (left-hand scale)

Registered unemployed (right-hand scale)

Source: The Directorate of Labour

Norges Bank

20

House pricesNEF/ECON (Jan 98 – Aug 04) and SN (98 Q1 – 04 Q2) Percentage rise on same period previous year

-5

0

5

10

15

20

25

30

1998 1999 2000 2001 2002 2003 2004

-5

0

5

10

15

20

25

30

SN

NEF

Sources: Statistics Norway (SN), Norwegian Association of Real Estate Agents (NEF), Association of Real Estate Agency Firms

Norges Bank

21

Commercial property pricesPrice per m2 per year in NOK. 1997 – June 2004

0

500

1000

1500

2000

2500

1997 1998 1999 2000 2001 2002 Jun-03 Nov-03 Jun-04

0

500

1000

1500

2000

2500

Oslo high standards

Oslo good standards

Bergen

StavangerTrondheim

Sources: OPAK and Dagens Næringsliv

Norges Bank

22

Housing starts and other building starts. 1000 m2 per month. Trend. Jan 00 – Jun 04

100

150

200

250

300

350

400

2000 2001 2002 2003 2004

100

150

200

250

300

350

400


Housing starts (left-hand scale)

Other building starts (right-hand scale)

Norges Bank

23

Domestic debt, total and distributed between households and non-financial enterprises (C2) 12-month rise. Aug 01 - Jul 04

-3

0

3

6

9

12

15

Aug-01

Dec-01

Apr-02

Aug-02

Dec-02

Apr-03

Aug-03

Dec-03

Apr-04

-3

0

3

6

9

12

15

C2 non-financial enterprises

Source: Norges Bank

C2 total

C2 households

Norges Bank

24

Prices for imported consumer goodsTotal and selected groups. 12-month rise. Per cent

-15

-12

-9

-6

-3

0

3

6

Jan-01 Jul-01 Jan-02 Jul-02 Jan-03 Jul-03 Jan-04 Jul-04

-15

-12

-9

-6

-3

0

3

6


Cars

Clothing and footwear

Imported consumer goods

Audiovisual equipment

Household appliances

Norges Bank

25

Prices for goods and services produced in Norway 12-month rise. Per cent

-3

-2

-1

0

1

2

3

4

5

6

Jan-02 Jul-02 Jan-03 Jul-03 Jan-04 Jul-04

-3

-2

-1

0

1

2

3

4

5

6

Other services

House rent

Services with wages as a dominant factor

Consumer goods produced in Norway


Documents

Norges Bank 1 Executive Board Meeting 22 September 2004