The Norwegian inflation data is set to be released next week. According to a Nordea Bank research report, the November inflation is likely to come in slightly below Norges Bank’s forecast, but the deviation will be very small to have any influence on the upcoming rate path.
“We forecast core inflation at 1.2 percent y/y, up from 1.1 percent last month. Norges Bank’s forecast is 1.3 percent”, stated Nordea Bank.
The prices on food and furniture had fallen sequentially last November, in contrast to the normal seasonal pattern and therefore the forecast for core inflation is higher. A normal pattern is expected in November 2017. Overall, this pulls up year-on-year core inflation by 0.2 percentage points. That is why Norges Bank projects 1.3 percent. Airfares rose strongly in October and would probably fall back again in December.
If the projections are realized, core inflation would be slightly on the downside to Norges Bank’s forecast, but not sufficient to have any considerably effect on its view, said Nordea Bank.
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