Chief economist Kjersti Haugland at DNB Carnegie has long held/recommended that the interest rate should go up, not down. Now she says that the krone will become weaker, prices are rising and the interest rate is to go up. A new element is that preparations for war are driving inflation.
– The price of the increased resilience is higher costs, inflationary pressure and rising public debt, which in turn contributes to high interest rates, DNB Carnegie points out in the report.
They therefore consider that we must prepare ourselves for the fact that price growth here in the country will remain above Norges Bank’s target of 2 per cent for some years yet.
DNB Carnegie envisages that CPI-ATE, which is the consumer price index the central bank looks closely at when it sets the policy rate, will stand at 3.1 per cent this year, 2.7 per cent next year and 2.6 per cent in 2028.
Norwegian interest-rate setting appears increasingly to be determined on the basis of political criteria. It is Norway that is the fabulously rich country in the Nordic region, yet we have by far the highest interest rate.
Now complaints are being made that Norgespris is becoming too expensive, so the ceiling must be raised.
The Swedish government has lowered VAT, fuel taxes and reduced the price of public transport. It has cost a packet – 67 billion – far above the Norwegian sums.
Therefore reduced fuel taxes have been followed up with support for electric transport, halved prices on public transport, lower VAT on foodstuffs and funds to the airlines to make tickets cheaper. All at an incredibly high price: 67 billion for the reduced fuel taxes and 37 for the VAT on foodstuffs, to mention two examples.
But the economists are sounding the alarm; they regard the public as a factor in a large landscape, a factor they can use for remediation and compensation in order to achieve their goals. This is a new way of thinking. Haugland is among the worst.
The time when the interest rate can be reduced will never come. Inflation has been made into a loop in which one can always justify the need for higher interest rates.
The world economy is shaking off the oil crisis and heading towards brighter times in 2027, according to DNB Carnegie. Norwegians must nevertheless prepare themselves for a new interest-rate rise and a weaker krone this autumn.
This is shown by the report “Economic Outlook” from DNB Carnegie, prepared under the leadership of chief economist Kjersti Haugland.
Behind the positive future prospects lies a massive global investment boom.
– Investments in technology, defence, infrastructure and energy are stimulating the economies. This contributes to our avoiding stagnation and high unemployment by a good margin this year, and we estimate an economic upswing next year, it is stated in the report.
Expects two interest-rate cuts in 2027For Norway’s part DNB Carnegie forecasts that growth in the mainland economy will pick up to around 1.5 per cent annually in the coming years.
Price growth is nevertheless still too high for Norges Bank to be able to leave the policy rate unchanged.
– Norwegian core inflation is estimated to make a rebound in August, so that Norges Bank follows its original plan of raising by one notch in September, to 4.50 per cent.
Only towards the end of 2027 does DNB Carnegie expect this year’s two interest-rate rises to be reversed. Going forward they also envisage that the Norwegian krone will remain weak compared with our neighbouring countries and against the euro.
Norway is in the process of introducing an authoritarian model. The Nordic model is dead. Then one must train the population to the effect that they are mute animals. Interest-rate policy and the exchange rate are powerful instruments.
Norwegians cannot afford to travel abroad. If road pricing is introduced, we shall not be able to afford to travel around in our own country either. It will be a visible proof that we have become powerless thralls under a new feudal class.
At the same time one obtains a class-divided society, for some can afford both.
