The Norwegian economy has shown notable signs of recovery since the summer of 2024. While the third quarter recorded nearly stagnant growth, Pål Sletten, the section head for national accounts at Statistics Norway (SSB), reports that GDP for Mainland Norway is up by 1.2 percent compared to last year.
During this latest quarter, household consumption rose by 0.9 percent, and the trend of increasing trade in goods continued. However, there was a decline in building and construction activities, coupled with a slowdown in the fishing and aquaculture sectors.
Sletten notes that random fluctuations contributed to the flat performance of the economy in the third quarter. Nevertheless, he maintains that the fundamental growth trends observed in the first half of the year remain intact.
Kyrre Knudsen, chief economist at Sparebank1 Sør-Norge, describes the current figures as “exciting.” He attributes the modest growth primarily to specific challenges within the fishing industry and general industrial sectors, while highlighting that the key drivers of Norway’s economy are, in fact, positive.
“The health of the Norwegian economy is promising. We are witnessing improvements in purchasing power, which boosts consumption. This uptick in private spending stems from robust wage growth, low unemployment, and falling interest rates. Furthermore, a significant increase in defense spending is also contributing to the economic uplift,” Knudsen explains.
On another positive note, oil production experienced a substantial increase, leading to an overall GDP growth of 1.1 percent when including oil extraction and foreign shipping. Employment figures also showed a slight uptick, with a 0.1 percent rise in the number of employed individuals from the second to third quarter.
In summary, Knudsen believes this comprehensive performance aligns well with Norges Bank’s forecasts, potentially setting the stage for interest rate cuts in 2026 and 2027.