Economic Survey 2-2004

The cyclical upturn in the Norwegian economy has now continued for one year, but output growth has been low over the past few quarters given that we are in the early phase of the upturn. The Norwegian economy thus remains in a slump. The global cyclical upturn is well under way but is also moderate from a historical perspective, particularly in the euro area. Both in Norway and abroad, the upturn is being fuelled by low interest rates. As expected, household demand is making a considerable contribution to the cyclical upturn. In Norway, higher petroleum investment is also making a contribution. In the period ahead, the global upturn will also stimulate Norway's exports of traditional goods. The situation for internationally exposed industries has now improved, not least thanks to what appears to be a stabilisation of the krone exchange rate at a more normal level and this year's moderate wage settlement. In many ways, there has been a reversal of developments in the factors that contributed to the cyclical downturn through 2001 and 2002.