Retail sales surprised on the downside, but will probably not be given too much weight. Unemployment s.a. unchanged as we expected. Unemployment slightly on the strong side to Norges Bank
We got a bunch of Norwegian figures today, whereas the retail sales where the biggest surprise. Retail sales fell -1,5 % m/m in July after a strong figure (+1,2 %) in June. The correction was bigger than both we (-0,4 %) and consensus (-0,3 %) had expected.
The figure is somewhat hard to interpret. We had a record warm July this year and we suspect that the figures are affected by that. Therefore we still think growth in consumption looks fairly strong, more or less in line with Norges Bank’s forecast.
Norges Bank refrained from doing any foreign exchange transactions in the market in September in connection with transfers to the Government Pension Fund Global in September.
Unemployment including those on labour market measures was about unchanged as we had expected. That is somewhat weaker than the picture so far this year when unemployment has been falling. This week’s LFS survey was also somewhat weaker than the previous months. Still it does not change the overall picture; the labour market seems to be somewhat stronger than earlier expected.
Registered unemployment in the three months since Norges Bank last interest rate forecast has been somewhat lower than it expected. Taken together with the stronger growth figures it argues for a higher rate path in the coming September report. The retail figure does not change that conclusion.
Details: Registered unemployment rate was 2.9% in August as expected. Seasonally adjusted unemployment was about unchanged decreased by 800 persons. Retail sales fell -1,5 % m/m in July after a strong figure (+1,2 %) in June.
Nordea