Weak output growth
According to Norges Bank's regional network contacts, output growth has slowed over the past 3 months. Contacts expected continued weak growth in the period ahead.
Output growth has slowed somewhat more than contacts had envisaged in January. Many contacts referred to falling demand from petroleum-related enterprises. Several also indicated that uncertainty regarding oil price developments ahead had a dampening effect on activity growth. At the same time, growth has slowed slightly in traditional manufacturing, especially in the export industry. Contacts also reported growth in housing construction, but there were considerable regional differences.
Network contacts expected continued weak growth over the next 6 months. Enterprises expected spillover effects of oil sector cost reductions to increase. The oil service sector and commercial services expected a continued fall in activity. The export industry envisaged some pick-up in growth ahead, owing in part to improved competitiveness.
Enterprises reported little change in capacity utilisation overall. At the same time, the share of enterprises reporting that labour supply was a constraint on further output growth was at its lowest level since the series began in 2005. Contacts reported a slight decrease in employment and also expected some decline in the period ahead. Network contacts overall estimated annual wage growth in 2015 of about 2¾ percent, down from an estimate of around 3 percent in January.
In this survey, information was provided by 325 regional network contacts. The interviews were largely conducted in May.
Please note that there have been changes to the weights and sector classification in Norges Bank's regional network. For a detailed account, see the following: New sector classification and new weights in Norges Bank's regional network (pdf)
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