Optimism is back in the Norwegian economy after the pandemic, according to the Confederation of Norwegian Enterprise (NHO). But interest rate increases will lead to weaker growth in the housing market.
House prices will increase by 9.8% this year, 5.1% next year, and 2.6% in 2023, according to NHO’s calculations.
Chief economist Øystein Dørum told newspaper Dagens Næringsliv (DN) that he thinks there may be two interest rate hikes this autumn that will somewhat slow down the development of the housing market.
An interest rate increase could be signaled as early as Thursday when Norges Bank will make a decision on the interest rate.
On Tuesday, NHO presented its new report on the future prospects of the Norwegian economy. Optimism is back in the Norwegian economy, and the end of the pandemic is in sight, NHO concluded.
“Now, it’s really brightening up,” NHO wrote in the report.
The economy will be back at the same level as before the corona pandemic during the third quarter of this year.
After a fall in mainland GDP of 2.5% last year, NHO now estimates an increase of 3.25% this year and 3.5% next year. That is marginally higher than the estimates in the previous report.
NHO expects that the growth in the mainland economy can send unemployment down to 3.6% in 2023, according to E24.
This year, unemployment is estimated to stabilize at around 4.6% before falling to 4% next year and then 3.6% in 2023.
Source: © NTB Scanpix / #Norway Today / #NorwayTodayFinance
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