Norway’s retail sales rose more than expected last month, indicating resilience among consumers in the face of rising prices and interest rates.
(Bloomberg) — Norway’s retail sales rose more than expected last month, indicating resilience among consumers in the face of rising prices and interest rates.
Seasonally adjusted retail sales rose 1.3% in January from the prior month, more than the 0.5% gain seen in a Bloomberg survey, data from Statistics Norway showed on Monday. That goes some way to retracing a revised 4.2% drop in December.
Monday’s reading at least “proves the point that retail spending has not fallen entirely off the cliff,” Marius Gonsholt Hov, Svenska Handelsbanken AB’s chief economist for Norway, said in a note. The economy as a whole has demonstrated a stronger performance than expected by Norges Bank, which Handelsbanken now forecasts will take its key interest rate to 3.75% from the current 2.75%, he said.
Grocery trade contributed the most to the rise in January, in contrast to the month before when there was a marked decline, the statistics office said in a statement. Retail trade in other household goods in specialist shops also contributed to the upswing, with interior items leading the way in that segment.
“The high inflation and rising interest rates have reduced households’ disposable income but households’ demand seems to be little affected,” Kyrre Aamdal, senior economist at DNB Bank ASA, said in a note. “The household sector seems able to handle a higher rate level than Norges Bank previously forecast.”
–With assistance from Harumi Ichikura and Mark Evans.
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