(March 19): A key survey of Norway’s business sentiment signalled somewhat better prospects for the nation’s companies, suggesting less pressure on the central bank to consider any easing moves in the near term.
Output is seen growing 0.4% next quarter, faster than the 0.3% estimated for the current three-month period, Norges Bank said on Thursday, citing its regional network contacts. The projection for the current quarter matched its previous survey in December.
The outcome largely backs the current outlook by Norges Bank governor Ida Wolden Bache who last month signalled continued focus on bringing the inflation rate down to the policymakers’ 2% target. The survey provides the last key bit of information for the rate-setters ahead of their meeting next week, while analysts have considered any moves at that point as unlikely given that the price outlook is clouded by the war in the Middle East.
While the Norwegian policymakers have made just two post-pandemic reductions in borrowing costs since June last year, to 4%, they’ve so far planned to extend their easing campaign by three more years, at about one quarter-point move per year.
Survey contacts are now projecting wage growth of 4.2% this year, up from the previous estimate of 4.1%.
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