- Retail sales slightly up in September after a weak summer
- Trend is more or less flat
- Small drop in LFS unemployment
Retail sales showed an increase in September after being nearly flat in August and sharply down in July. The trend is now sideways, but Q3 was weak and shows a growth of -0.5% q/q. Weak retail sales indicates that private consumption developed quite poorly in Q3 and will contribute to drag down GDP growth (Q3 GDP is published 19 November). Household demand has been weaker than Norges Bank’s forecast, but today’s figures might convince Norges Bank that the weakness is temporary. Based on decent income growth and still low unemployment there are solid arguments for expecting a further pick-up in retail sales going forward.
LFS unemployment came out at 3.5 % in August, down from 3.6 % in July. Both the labour force and employment increased, but employment growth was slightly stronger. The figures are more or less in line with Norges Bank. Since April, employment has shown decent growth after the weak development last winter. Still, we will put more weight to the upcoming figures for registered unemployment published on Friday.
Today’s data were two moderately positive surprises. We don’t think Norges Bank will change view based on these figures, but it strengthens the case that the weakness in retail sales is only temporary.
Details:
- Retail sales 0.7% m/m (s/a) in September after 0.2% m/m in August. Consensus +0.5% m/m and Nordea -0.8% m/m.
- LFS unemployment down to 3.5% in August from 3.6% in July. Consensus and Nordea 3.6%. Employment +4000 persons, labour force +3000 persons.
Nordea