Norway GDP Emerges Stronger than Expected, Prompts Possible Early Rate Hikes

Mainland gross domestic product, which adjusts for Norway’s offshore industry rose by 1.9% in the fourth quarter, according to Statistics Norway press release. Q4 GDP was more than expected 1.3% expansion rate.

• Norway’s FY20 GDP contracted by 2.5%, much less that predicted 3.5%. 
• Norway’s FY20 GDP was also much stronger than the Eurozone economy which shrank by almost 7%
• Norway’s resilience was underpinned by its oil wealth and $1.3 trillion wealth fund
• The resilience of Norway’s economy has left economists betting that the central bank will raise rates years before others.
• Norway’s central bank expected the first rate hike in early 2022, but now, analysts and investors are projecting an early move.

Norwegian krone is declining against the dollar. USDNOK is up 0.23%