Charts for Inflation Report 2/2004
Chapter 1.
Chart 1.1 CPI-ATE1). Total and by supplier sector2). 12-month rise. Per cent. Jan 01 – May 04
6 4 2 0 -2 -4 -6 2001
1) CPI-ATE:
6
Goods and services produced in Norway
4 2 0
CPI-ATE
Imported consumer goods
-2 -4 -6
2002
2003
2004
CPI adjusted for tax changes and excluding energy
products 2) Norges Bank's estimates
Sources: Statistics Norway and Norges Bank
Chart 1.2 Prices for goods and services produced in Norway1). 12-month rise. Per cent. Jan 01 – May 04
6 5 4 3 2 1 0 -1 2001
1) Adjusted
6
Services produced in Norway (27)
5 4 3 2
Goods produced in Norway (27)
1 0 -1
2002
2003
2004
for tax changes and excluding energy products Percentage share of CPI-ATE in brackets. Norges Bank's estimates
Sources: Statistics Norway and Norges Bank
Chart 1.3 Employed persons according to LFS. In millions. Seasonally adjusted. Monthly figures. Jan 98 – Mar 04
2,30 2,28 2,26 2,24 2,22 1998 1999 2000 2001 2002 2003 2004
Source: Statistics Norway
2,30 2,28 2,26 2,24 2,22
Chart 1.4 Interest rate expectations. Actual developments and expected key rate1) at 24 Jun 04. 2 Jan 03 – 1 May 06
6 5 4 3 2 1 0 2003
1) FRA and
6
UK
5 4
Norway
3
Euro area
2 1 0
US
2004
2005
2006
futures contracts adjusted for the estimated difference between 3-month money market rates and the key rate
Sources: Bloomberg, Reuters and Norges Bank
Chart 1.5 Yield on government bonds with 10 years’ residual maturity. Daily figures. 1 Jan 03 – 24 Jun 04
6
Norway
6
5
Germany
5
4
US
4
3 jan 03 mai 03
3 jan 04 mai 04
sep 03
Sources: Bloomberg and Norges Bank
Chart 1.6 Import-weighted exchange rate index, I-441). Daily figures. 1 Jan 04 – 24 June 04
102 100 98 96 94 92 jan 04
1)A rising
102 100 98 96 94 92 mar 04 mai 04 jul 04
curve denotes a weaker krone exchange rate
Source: Norges Bank
Chapter 2.
Chart 2.1 GDP. 4-quarter growth. Per cent. 01 Q1 – 04 Q1
5
US
5
UK Euro area
3 1 -2 -4 2001
3 1 -2 -4 2002 2003 2004
Japan
Sources: EcoWin, Statistics Japan, National Statistics (UK), EUR-OP/Eurostat and Bureau of Economic Analysis (US)
Chart 2.2 Interest rate expectations. Actual developments and expected key rate1) at 4 March and 24 June 2004. 2 Jan 03 – 1 May 06 6 6
5 4 3 2 1 0 2003
1) FRA and
5
UK
4 3
Euro area
2
24 June 4 March
US
1 0
2004
2005
2006
futures contracts adjusted for the estimated difference between 3-month money market rates and the key rate
Sources: Bloomberg, Reuters and Norges Bank
Chart 2.3 Structural budget balance. Per cent of nominal GDP. Annual figures. 1995 – 20051)
2
US
2 0
Euro area
0 -2 -4 -6 -8 1995 1997 1999 2001 2003 2005
1) Estimates
-2 -4
Japan
-6 -8
for 2003 – 2005
Source: OECD
Chart 2.4 Consumer prices. 12-month rise. Per cent. Jan 01 – Jun 04
6
Ireland
6
4
Portugal Euro area
4
2
Germany
2
0 jan 01 jan 02 jan 03 jan 04
0
Sources: EcoWin, EUR-OP/Eurostat, Federal Statistical Office (DE) and Central Statistics Office (IRL)
Chart 2.5 Consumer prices. 12-month rise. Per cent. Jan 01 – May 04
4
Denmark (HICP)
4
Sweden (UND1X)
3 2 1 0 -1 jan 01 okt 01 jul 02 apr 03
Finland (HICP)
3 2 1
Norway (CPI-ATE)
0 -1
jan 04
Sources: EcoWin, Statistics Norway, Statistics Sweden, Statistics Finland and Statistics Denmark
Chart 2.6 Producer prices. 12-month rise. Per cent. Jan 00 – May 04
6
US
6 4
UK Euro area
4 2 0 -2 -4 jan 00 jan 01 jan 02 jan 03 jan 04
Japan
2 0 -2 -4
Sources: EcoWin, EUR-OP/Eurostat, Bureau of Labor Statistics (US), Statistics Japan, Federal Statistical Office (DE) and National Statistics (UK)
Chart 2.7 GDP. Change on same quarter previous year1). Per cent. 01 Q1 – 04 Q1
12 10 8 6 4 2 0 -2 2001
1) GDP
12 10
China
8 6
India
4 2
Malaysia
0 -2 2003 2004
2002
in India is measured at factor prices
Sources: EcoWin, National Bureau of Statistics (CH), Central Bank of Malaysia, Central Statistical Organisation (I) and Consensus Economics
Chart 2.8 Oil price1) in USD per barrel. Daily figures. 1 Jan 01 – 24 Jun 04. Futures prices at 4 Mar 04 and 24 Jun 04
40 35 30 25 20 15 2001 2002 2003 2004 2005 2006
1)
40
Futures prices 24 June 04 Oil price
35 30
Futures prices 4 March 04
25 20 15
Brent Blend
Sources: International Petroleum Exchange and Norges Bank
Chart 2.9 Commodity prices in USD. Index. Jan 1994=100. 3-month moving average. Monthly figures. Jan 94 – Jun 041)
170 150 130 110 90 70 50
Zinc
Copper Aluminium
170 150 130 110 90
Coal
70 50
1994 1996 1998 2000 2002 2004
1) Average
from 1 June – 24 June
Sources: London Metal Exchange, HWWA and EcoWin
Chart 2.10 Wage growth. Change on same quarter previous year. Per cent. 97 Q1 – 04 Q1
7 6 5 4 3 2 1 0 1997 1999 2001 2003
Euro area US UK
7 6 5 4 3 2 1 0
Sources: Bureau of Labor Statistics (US), National Statistics (UK) and EUR-OP/Eurostat
Chart 2.11 Consumer price inflation. Year-on-year rise. Per cent. 1995 – 20071)
4
US Euro area
4
2
Norway's trading partners
2
0
Japan
0
-2 1995 1997 1999 2001 2003 2005 2007
1) Estimates
-2
for 2004 – 2007
Sources: OECD and Norges Bank
Chapter 3.
Chart 3.1 Assumption for the money market rate1). Forward interest rate2). Monthly figures. Per cent
10 8 6 4 2 0 2001 2002 2003 2004 2005 2006 2007
1) The
10
3-month money market rate Forward rate 24 June (assumption IR 2/04)
8 6 4 2 0
money market rate is normally about ¼ percentage point higher than the sight deposit rate 2) 3-month money market rate up to May 2004. The 3-month forward rate is estimated using four money market rates and four government bond yields with different maturities as observed on 24 June
Source: Norges Bank
Chart 3.2 Assumption for the krone exchange rate (I-44)1). Forward exchange rates. Monthly figures
110
Import-weighted exchange rate, I-44
110
100
100
90
Forward rate 24 June (assumption IR 2/04)
90
80 2001 2002 2003 2004 2005 2006 2007
1)A rising
80
curve denotes a weaker krone exchange rate
Source: Norges Bank
Chart 3.3 Projections for the output gap1), actual GDP2) and trend GDP2). Annual figures. 1990 – 20073) 10 1400
8 6 4 2 0 -2 -4
Output gap (left-hand scale) Trend GDP (right hand scale) Actual GDP (right-hand scale)
1100
800
500
1990
1) The
1994
1998
2002
2006
output gap is a measure of the difference between actual and trend mainland GDP. Difference in per cent 2) In billions of NOK. Constant 2001 prices 3) Estimates for 2004 – 2007
Sources: Statistics Norway and Norges Bank
Chart 3.4 Real growth in household disposable income and consumption. Annual figures. Per cent. 1990 – 20071)
10 8 6 4 2 0 1990 1993
1) Estimates
Real income growth Real growth in consumption
10 8 6 4 2 0
1996
1999 2002
2005
for 2004 – 2007
Sources: Statistics Norway and Norges Bank
Chart 3.5 Seasonally adjusted house prices. NOK 1000 per square metre. Monthly figures. Jan 00 – May 04
18 17 16 15 14 13 12 2000 2001 2002 2003 2004 18 17 16 15 14 13 12
Sources: Norwegian Association of Real Estate Agents and Association of Real Estate Agency Firms
Chart 3.6 Growth in credit1) to households and enterprises. 12-month growth. Per cent. Jan 97 – Apr 04
18 15 12 9 6 3 0 -3 1997
1)
18
Credit to households
15 12 9 6
Credit to non-financial enterprises
3 0 -3
1999
2001
2003
From domestic sources (C2)
Source: Norges Bank
Chart 3.7 Investment in mainland Norway as a share of mainland GDP and LFS unemployment. Per cent. Annual figures. 1992 – 20071)
21 19 17 15 13 1992
1) Estimates
Investment share (left-hand scale)
2.7 3.3 3.9 4.5
LFS unemployment (inverted, right-hand scale)
5.1 5.7 6.3
1996
for 2004 – 2007
2000
2004
Source: Statistics Norway
Chart 3.8 Manufacturing output index. Volume. 3-month moving average. Jan 00 – Apr 04
114 110 106 102 98 94 90 2000 2001 2002 2003 2004
Source: Statistics Norway
Consumer goods Intermediate goods Capital goods
114 110 106 102 98 94 90
Chart 3.9 Change in structural non-oil budget balance1). Annual figures.1990 – 2004
3 2 1 0 -1 -2 -3 1990 1992 1994 1996 1998 2000 2002 2004
budget balance as a percentage of trend GDP for mainland Norway, change on previous year
1) The
3 2 1 0 -1 -2 -3
Source: Revised National Budget 2004
Chart 3.10 Underlying spending growth in the government budget and nominal growth in mainland GDP. Year-on-year growth. Per cent. 1990 – 20041)
10 8 6 4 2 0 1990 1992 1994 1996 1998 2000 2002 2004
1) Estimates
10
Underlying spending growth
8 6 4
Nominal growth in mainland GDP
2 0
for 2004
Sources: Ministry of Finance and Statistics Norway
Chart 3.11 Growth in number employed and contributions from the public sector. Annual figures. 1971 – 2003
4 3 2 1 0 -1 -2 -3 -4 1971 1976 1981 1986 1991 1996 2001
Source: Statistics Norway
Contribution from public sector, percentage points Employment growth, per cent
4 3 2 1 0 -1 -2 -3 -4
Chart 3.12 Change in employment on previous year, per cent. Unemployment1) as a percentage of the labour force. Annual figures. 1980 – 20072)
LFS unemployment (left-hand scale)
4 2
6
4
0 -2 -4 1980 1985 1990 1995 2000 2005
unemployment for 2004 – 2007
2
Number employed (right-hand scale)
0
1) LFS
2) Estimates
Sources: Statistics Norway and Norges Bank
Chart 3.13 Labour force as a percentage of population aged 16–74 (labour force participation rate). Per cent. Annual figures. 1980 – 20071)
75 73 71 69 67 65 1980 1984 1988 1992 1996 2000 2004
1) Estimates
75
Labour force participation rate
73 71 69 67 65
for 2004 – 2007
Sources: Statistics Norway and Norges Bank
Chart 3.14 Number of disability pensioners as a percentage of the population (aged 18 – 67) and number of sickness days per employee1). Annual figures. 1980 – 2003
14
Sickness days2)
14 12 10 8
Disability pensioners
12 10 8 6 4 1980 1984 1988 1992 1996 2000
by the National Insurance 2000 the sick pay scheme has also applied to all central government employees. This results in a break in the series between 1999 and 2000
2) Since 1) Paid
6 4
Source: National Insurance Administration
Chart 3.15 Developments in number of person-hours worked and the number of employed persons in mainland Norway. Annual figures. Index. 1970=100. 1970 – 2003
150 140 130 120 110 100 90 1970 1975 1980 1985 1990 1995 2000
Sources: Statistics Norway and Norges Bank
Person-hours Employment
150 140 130 120 110 100 90
Chapter 4.
Chart 4.1 Assumption for the krone exchange rate (I-44)1). Forward exchange rates. Monthly figures
110
Forward rate 4 March (assumption IR 1/04)
110
100
100
90
Import-weighted exchange rate, I-44
Forward rate 24 June (assumption IR 2/04)
90
80 2001 2002 2003 2004 2005 2006 2007
1)A rising
80
curve denotes a weaker krone exchange rate
Source: Norges Bank
Chart 4.2 Assumption for the money market rate1). Forward interest rate2). Monthly figures. Per cent
10 8 6 4 2 0 2001 2002 2003 2004 2005 2006 2007
1) The
10
3-month money market rate Forward rate 24 June (assumption IR 2/04)
8 6 4
Forward rate 4 March (assumption IR 1/04)
2 0
money market rate is normally about ¼ percentage point higher than the sight deposit rate 2) 3-month money market rate up to May 2004. The 3-month forward rate is estimated using four money market rates and four government bond yields with different maturities as observed on 4 March and 24 June
Source: Norges Bank
Chart 4.3 CPI-ATE. Seasonally adjusted monthly rise. 3-month moving average, annualised. Oct 03 – Dec 041)
3 2 1 0 -1 -2 -3 nov 03
1)
3 2
Historical
1 0
Projections
-1 -2 -3
feb 04
mai 04
aug 04
nov 04
Estimates from Jun 04 – Dec 04
Sources: Statistics Norway and Norges Bank
Chart 4.4 CPI-ATE. Total and by supplier sector1). 12-month rise. Per cent. Jan 01 – Dec 072) 6 6
4 2 0 -2 -4 -6
Goods and services produced in Norway
4 2 0 -2
CPI-ATE
Imported consumer goods
-4 -6
2001 2002 2003 2004 2005 2006 2007
1) 2)
Norges Bank's estimates Estimates from Jun 04 – Dec 07
Sources: Statistics Norway and Norges Bank
Chart 4.5 CPI and CPI-ATE. 12-month rise. Per cent. Jan 01 – Dec 071)
6 4 2 0 -2 2001 2002 2003 2004 2005 2006 2007
1)
6
CPI
4 2
CPI-ATE
0 -2
Estimates from Jun 04 – Dec 07
Sources: Statistics Norway and Norges Bank
Chart 4.6 CPI and prices for imported consumer goods. Annual figures. Index. 1998=100. 1979 – 2003
120 105 90 75 60 45 30 1979 1983 1987 1991 1995 1999 2003
Source: Statistics Norway
Consumer price index Imported consumer goods
120 105 90 75 60 45 30
Chart 4.7 Projected price movements for some imported consumer goods, measured in foreign currency. Quarterly figures. Index. 91 Q1=100. 91 Q1 – 04 Q1
110 100 90 80 70 60 50
Clothing and footwear
110 100 90 80
Audiovisual equipment
70 60 50
1991 1993 1995 1997 1999 2001 2003
Sources: EcoWin and Norges Bank
Chart 4.8 Indicator of external price impulses to imported consumer goods measured in foreign currency. Annual figures. 1995 – 20071)
3 2 1 0 -1 -2 -3 1995 1997 1999 2001 2003 2005 2007
1) Estimates
3 2 1 0 -1 -2 -3
for 2004 – 2007
Source: Norges Bank
Chart 4.9 Prices for imported consumer goods in the CPI and in External Trade Statistics, and I-44. 4-quarter rise. Per cent. 98 Q1 – 04 Q2
10 5 0 -5 -10 -15 1998
1)
10
I-44
5 0
Imported consumer goods in External Trade Statistics1) Imported consumer goods in CPI2)
-5 -10 -15
2000
2002
2004
Norges Bank's estimates: Clothing and accessories, footwear, furniture, food and beverages 2) Excluding audiovisual equipment and cars. Observations in April and May 2004 are used as the basis for the second quarter
Sources: Statistics Norway and Norges Bank
Chart 4.10 Contribution of the exchange rate to rise in prices for imported consumer goods. Based on historical exchange rates and the forward exchange rate in Inflation Report 1/04 and 2/04. Percentage points. Quarterly figures. 01 Q1 – 07 Q4
3 2 1 0 -1 -2 -3 2001 2002 2003 2004 2005 2006 2007
Source: Norges Bank
Inflation Report 2/04 Inflation Report 1/04
3 2 1 0 -1 -2 -3
Chart 4.11 Labour costs per produced unit1) and domestic price inflation2). Rise on same period previous year. Per cent. Jun 80 – May 04
16 12 8 4 0
Domestic inflation Labour costs per produced unit
16 12 8 4 0 -4
-4
1980 1984 1988 1992 1996 2000 2004
Labour costs in relation to gross product. Mainland Norway excl. the energy sector. 4-quarter moving average 2) Adjusted for tax changes and excluding energy products. Monthly figures
1)
Sources: Statistics Norway and Norges Bank
Chart 4.12 Expected consumer price inflation in 5 years. Per cent. Quarterly figures. 02 Q2 – 04 Q2
4 3 2 1 0 jun 02
Employer organisations Employee organisations Experts
4 3 2 1 0 jun 04
des 02
jun 03
des 03
Source: TNS Gallup
Chart 4.13 Expected consumer price inflation in 2 years. Per cent. Quarterly figures. 02 Q2 – 04 Q2
4
Employee organisations
4 3
Experts Employer organisations
3 2 1 0 jun 02 des 02 jun 03 des 03 jun 04
Source: TNS Gallup
2 1 0
Chart 4.14 Annual wage growth1) and unemployment rate2). Per cent. Annual figures. 1993 – 20073)
Annual wage growth
6 4
6 4
Unemployment rate
2 0 1993 1995 1997 1999 2001 2003 2005 2007
1) Average
2)
2 0
for all groups. Including cost of additional vacation days
for 2004 – 2007
LFS
3) Projections
Sources: Technical Reporting Committee on Income Settlements, Statistics Norway and Norges Bank
Chart 4.15 Growth in real consumer wages and real producer wages1). Per cent. Annual figures. 1996 –20072) 5 5
4 3 2 1 0 1996
1) Consumer
Real consumer wages
4 3 2 1 0
Real producer wages
1999
2002
2005
price inflation for goods and services produced in Norway is used as a deflator for real producer wages. The CPI is the deflator for real consumer wages 2) Projections for 2004 – 2007
Source: Norges Bank
Chart 4.16 Projections and uncertainty for the CPIATE1). 12-month rise. Per cent. Jan 01 – Dec 07
5
30% 50% 70% 90%
5 4 3 2 1 0 -1
4 3 2 1 0 -1 2001 2002 2003 2004 2005 2006 2007
The bands in the fan indicate different probabilities for developments in the CPI-ATE. Probabilities are based on the difference between projected and actual developments in underlying inflation in the period 1997 – 2004
1)
Sources: Statistics Norway and Norges Bank
Chart 4.17 Changes in I-44. Daily figures. 1 Mar 04 – 24 Jun 04
100 98 96 94 92 Mar 04
1)A rising
100 98 96 94 92 Apr 04 May 04 Jun 04
curve denotes a weaker krone exchange rate
Source: Norges Bank
Chapter 5
Chart 5.1 CPI. Moving 10-year average1) and variation2). 1979 – 20043). Per cent 14
12 10 8 6 4 2 0 1979
1) The
14 12 10
CPI Inflation target
8 6 4 2
1984
1989
1994
1999
0 2004
moving average is estimated 7 years back, current year and 2 years ahead 2) The band around the CPI is the variation in the period, measured as +/- one standard deviation 3) Figures for 2002 – 2004 are based on projections
Sources: Statistics Norway and Norges Bank
Chart 5.2 Projections for the output gap, level1)and variation2). 1979 – 2004. Per cent
8 6 4 2 0 -2 -4 -6 -8 1980
1) The
8 6 4 2
CPI1)
0 -2 -4
Inflation target
-6 -8
1985
1990
1995
2000
output gap measures the difference between actual and trend mainland GDP 2) The band shows the variation in the output gap measured as + one standard deviation. The variation is estimated as average standard deviation in a 10-year period, 7 years back, current year and 2 years ahead
Sources: Statistics Norway and Norges Bank
Chart 5.3 Projections for the CPI-ATE1) and the output gap2) in Inflation Report 1/04 (red) and 2/04 (green). Per cent 3 3
2 1 0 -1 -2 2002
2) The
CPI-ATE IR 1/04 IR 2/04
2 1 0
Output gap
-1 -2
2003
2004
2005
2006
2007
1) CPI-ATE:
CPI adjusted for tax changes and excl. energy products output gap measures the difference between actual and trend mainland GDP
Sources: Statistics Norway and Norges Bank
Chart 5.4 Assumption for the money market rate1). Forward interest rate2). Monthly figures. Per cent
10 8 6 4 2 0 2001 2002 2003 2004 2005 2006 2007
1) The
10
3-month money market rate Forward rate 24 June (assumption IR 2/04)
8 6 4
Forward rate 4 March (assumption IR 1/04)
2 0
money market rate is normally about ¼ percentage point higher than the sight deposit rate 2) 3-month money market rate up to May 2004. The 3-month forward rate is estimated using four money market rates and four government bond yields with different maturities as observed on 4 March and 24 June
Source: Norges Bank
Chart 5.5 Assumption for the krone exchange rate (I-44)1). Forward exchange rates. Monthly figures
110
Forward rate 4 March (assumption IR 1/04)
110
100
100
90
Import-weighted exchange rate, I-44
Forward rate 24 June (assumption IR 2/04)
90
80 2001 2002 2003 2004 2005 2006 2007
1)A rising
80
curve denotes a weaker krone exchange rate
Source: Norges Bank
Chart 5.6 Interval for the sight deposit rate at the end of each strategy period and actual developments. Daily figures. 1 Nov 02 – 1 July 04
8 7 6 5 4 3 2 1 0
Strategy period 3/02
8 7 6 5
Strategy period 2/03 Strategy period 3/03
Strategy period 1/03
4 3 2 1 0
Sight deposit rate
Strategy period 1/04
nov 02 mar 03
jul 03
nov 03 mar 04
jul 04
Source: Norges Bank
Chart 5.7 Import-weighted krone exchange rate1), sight deposit rate and 3-month interest rate differential against trading partners. Daily figures. 1 Jan 02 – 24 Jun 04
85 90 95 100 105 110 2002
1)A rising
8
I-44 (left-hand scale)
6 4
3-month interest rate differential (righthand scale)
Sight deposit rate (right-hand scale)
2 0 -2
2003
2004
curve denotes a stronger krone exchange rate
Source: Norges Bank
Chart 5.8 Forward interest rates. Monthly figures. Per cent. Jan 04 – Dec 07
6 5 4 3 2 1 2004
1) Estimated
6 5
Forward rate trading partners1)
4 3
24 June 4 March
2 1
Norwegian forward interest rate
2005
2006
2007
2008
as a weighted average of the forward rates for the euro area, the US, Sweden and the UK
Source: Norges Bank
Chart 5.9 Projections for CPI-ATE1) and the output gap2). Per cent
3 2 1 0 -1 -2 2002 2003 2004 2005 2006 2007
1) CPI-ATE:
3
CPI-ATE
2 1 0
Output gap
-1 -2
CPI adjusted for tax changes and excluding energy
products 2) The output gap measures the difference between actual and trend mainland GDP
Sources: Statistics Norway and Norges Bank
Chart 5.10 3-month money-market rate1), Taylor rate, forward interest rates for trading partners and Norway at 24 June. Monthly figures. Jan 01 – Dec 04
10 8 6 4 2 0
Forward rates for trading partners Norwegian forward rate 3-month rate, Norway
10 8 6 4 2 0
Taylor rate
2001
1) The
2002
2003
2004
money market rate is normally about ¼ percentage point higher than the sight deposit rate
Sources: Statistics Norway and Norges Bank