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Core inflation rose less than expected last month, but is still well above Norges Bank’s target.
Published:,
Core inflation rose 3.3% annually in September, according to recent figures from Statistics Norway.
In advance, the consensus was that core inflation would rise 3.6% annually.
DNB Markets, for its part, expected an increase of 3.7 percent.
Core inflation is the figure that Norges Bank looks at when setting interest rates. Often referred to as core inflation, it excludes electricity and fuel prices. Norges Bank’s inflation target is two percent over time.
However, the September figure is below Norges Bank’s forecast of 3.6 percent, DNB Markets notes in a note.
– If all else remains the same, reduce upward pressure on the interest rate path, the brokerage writes.
The previous month, in August, core inflation increased 3.7 percent annually.
Food prices are rising
The consumer price index, on the other hand, rose 1.6 percent annually in September. The most important contributor to the year-on-year increase is food prices, which are 4.3% higher this year than last.
“Rising prices for new cars, restaurant services and other cultural and leisure related services also contributed to the twelve-month growth,” writes Statistics Norway.
However, electricity prices are pulling in the opposite direction. According to Statistics Norway, prices for electricity and rent for the network were 25% lower in September this year than last year.
However, on a monthly basis, electricity prices are the largest contributors to the rise in the consumer price index.
The reason for this is that grid rental electricity prices increased 9.1 percent during September, even though prices are much lower than last year.
Price drop on domestic flights
At the same time, inflation continues to be affected by the corona pandemic, even though most services are available again, the statistics agency writes. At the same time, there is still a special treatment of various services related to tourism.
A drop in the price of domestic flights, which was the most important factor in slowing the rise in the consumer price index last month. In addition, a further fall in fuel and food prices contributed, according to Statistics Norway.
