Monetary policy, inflation and the
outlook for the Norwegian economy
DnB, Haugesund
Svein Gjedrem, Governor of Norges Bank,
10 April 2003
Effective exchange rates January 1990=100 60 70 80 90 100 110 120 1990 1992 1994 1996 1998 2000 2002 60 70 80 90 100 110 120 SEK NOK GBP NZD Source: EcoWin
Equity prices and long-term interest rates in the US 0 400 800 1200 1600 1990 1992 1994 1996 1998 2000 2002 0 3 6 9 12 Source: EcoWin 10-year rate (right-hand scale) Standard & Poor’s 500
(left-hand scale) Per cent Index A war economy Index. January 2001 = 100 90 95 100 105 110 2001 2002 2003 50 75 100 125 150 Source: EcoWin Gold (right-hand scale) Swiss franc (left-hand scale) Oil (right-hand scale) 11 September Resolution 1441 War in Iraq begins
Stocks of crude oil in the US Million barrels. Weekly figures
260 280 300 320 340 360
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
260 280 300 320 340 360 500 550 600 650 1997 1998 1999 2000 2001 2002 2003
Source: US Department of Energy
2003
Highest and lowest value last five years
Strategic reserves
2002 Commercial stocks
Oil production in Iraq and Venezuela
Million barrels per day
0 1 2 3 4
Jan 00 Jul 00 Jan 01 Jul 01 Jan 02 Jul 02 Jan 03 0 1 2 3 4
Sources: Energy Information Agency and Petroleum Intelligence Weekly Monthly figures Iraq Venezuela 0 1 2 3 4 1986 1988 1990 1992 1994 1996 1998 2000 2002 Annual figures
Value of oil and gas exports from the Norwegian continental shelf. 1990-2002 0 50 100 150 200 250 300 350 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 Natural gas Crude oil Billion kroner
Source: Statistics Norway
Oil price and Norwegian export price for natural gas converted to USD per barrel (oil equivalents)
0 10 20 30 40 1997 1998 1999 2000 2001 2002 2003 0 10 20 30 40
Norwegian gas for export Brent Blend
USD/barrel o.e.
Estimate of demand and production of natural gas in the UK
0 30 60 90 120 150 180 2003 2005 2007 2009 2011 2013 2015 2017 2019 0 30 60 90 120 150 180 Demand Production
Source: Norwegian Petroleum Directorate Billion Sm3
The krone exchange rate and the interest rate differential
0 1 2 3 4 5 1999 2000 2001 2002 2003 90 95 100 105 110 115
Source: Norges Bank
Krone exchange rate (TWI, right-hand scale) Interest rate differential
(left-hand scale)
Index Per cent
The krone exchange rate (TWI) and equity prices in the US 90 95 100 105 110 1999 2000 2001 2002 2003 700 900 1100 1300 1500
Sources: EcoWin and Norges Bank TWI
(left-hand scale)
Equity prices (right-hand scale)
Cyclical divergence
Short-term interest rates in the US and Norway
0 2 4 6 8 10 1995 1996 1997 1998 1999 2000 2001 2002 2003 0 2 4 6 8 10
Source: Norges Bank
Norway
Interest rate expectations in the US Actual developments and expected key rate
0 2 4 6 1999 2000 2001 2002 2003 2004 0 2 4 6
Sources: Bloomberg and Norges Bank
1 July Key rate
24 Oct.
7 April
Interest rate expectations in the euro area Actual developments and expected key rate
0 2 4 6 1999 2000 2001 2002 2003 2004 0 2 4 6
Sources: Bloomberg and Norges Bank
1 July
24 Oct.
Key rate
Business sentiment indicator Seasonally adjusted diffusion index*)
-10 -5 0 5 10 15 1990 1992 1994 1996 1998 2000 2002 -10 -5 0 5 10 15
Sources: Statistics Norway and Norges Bank
*) Values below zero indicate that the majority of the industrial leaders expect weaker developments the coming three months
Number of bankruptcy petitions Change from one year earlier
-100 -50 0 50 100 150 200
Jan 99 Jul 99 Jan 00 Jul 00 Jan 01 Jul 01 Jan 02 Jul 02 Jan 03 Source: Statistics Norway
New orders, manufacturing Value index 1995=100 50 100 150 200 250 93 94 95 96 97 98 99 00 01 02 50 100 150 200 250
Source: Statistics Norway
Domestic
Export
New orders, transport equipment industry Value index 1995=100 0 50 100 150 200 250 93 94 95 96 97 98 99 00 01 02 0 50 100 150 200 250
Source: Statistics Norway
Relative labour costs, manufacturing Index 1990 = 100 80 90 100 110 120 1990 1992 1994 1996 1998 2000 2002 2004 80 90 100 110 120
Source: Norges Bank
Local currency
Common currency
Norges Bank's regional network
Region North
Kunnskapsparken Bodø
Region Central Norway Allforsk in Trondheim Region North-West Møreforskning Molde Region South-West Rogalandsforskning Region Inland Østlandsforskning Region East
Covered by Norges Bank Region South
0% 10% 20% 30% 40% Norway Rogaland Employment by industry Rogaland and country as a whole Percentage of total employment (Q4 2001)
Source: Statistics Norway Publ. admin. and other services Retail trade, hotel and restaurant Manufacturing Commercial services Transport, communica-tions Construc-tion Electricity, gas and water supply Financial services Agriculture forestry, fish Extraction of crude oil and natural gas
Source: Statistics Norway
Exports of traditional goods
Per cent of total exports of traditional goods. February 2003
0 2 4 6 8 10 12 Hordaland Rogaland Møre og R. Vestfold V. Agder Buskerud Telemark Østfold Nordland Sogn og Fj. Oslo Akershus Oppland S. Trøndelag Hedmark N. Trøndelag A. Agder Troms Finnmark
Source: Public Employment Service
Unemployment
Per cent av labour force. March 2003
0 1 2 3 4 5 6 Finnmark A. Agder Oslo Telemark S. Trøndelag V. Agder N.TrøndelagNordland HordalandØstfold Rogaland Møre og R. Vestfold Troms Hedmark Buskerud Sogn og Fj. Akershus Oppland Norway Mainland GDP
Percentage change from previous year. Alternative scenarios
0 1 2 3 4 5 6 1990 1992 1994 1996 1998 2000 2002 2004 0 1 2 3 4 5 6
Source: Norges Bank
Forward interest rate and forward exchange rate
Consumer prices adjusted for tax changes and excluding energy products (CPI-ATE)
12-month rise. Per cent
-4 -2 0 2 4 6 1999 2000 2001 2002 2003 -4 -2 0 2 4 6
Sources: Statistics Norway and Norges Bank
Goods and services produced in Norway
CPI-ATE
Imported consumer goods
Consumer prices adjusted for tax changes and excluding energy products (CPI-ATE)
Alternative scenarios. 12-month rise. Per cent
0 0.5 1 1.5 2 2.5 3 3.5 2001 2002 2003 2004 2005 0 0.5 1 1.5 2 2.5 3 3.5 CPI-ATE
Sources: Statistics Norway and Norges Bank
Forward interest rate and forward exchange rate
