Norges Bank 1 Executive Board meeting 27 September 2006

Norges Bank 2 Source: Statistics Norway Mainland GDP Seasonally adjusted, annualised growth on previous half year. Per cent

Norges Bank 3 Unemployed Percentage of labour force. Seasonally adjusted. January 1990 – August 2006 LFS unemployment Registered unemployed and on labour market programmes Registered unemployed Sources: Statistics Norway and the Directorate of Labour

Norges Bank 4 Source: Statistics Norway Number employed Figures from LFS 1). In thousands. Monthly figures. January 1999 – June ) The restructuring of the LFS has resulted in a break in the time series between 2005 and 2006.

Norges Bank 5 Capacity utilisation - regional network Share of enterprises that will find it difficult to accommodate a rise in demand. Per cent Source: Norges Bank

Norges Bank 6 Order stocks and new orders in manufacturing Index = Q Q2 Source: Statistics Norway Order stocks New orders

Norges Bank 7 Investment intentions survey. Oil and gas activities Assumed and actual investment. In billions of NOK Source: Statistics Norway Previous yearSame yearFinal figures

Norges Bank 8 Credit growth 12-month change. Per cent. January July 2006 (C3 to June) Source: Norges Bank Total credit enterprises(C3) Domestic credit to households (C2) Domestic credit enterprises (C2)

Norges Bank 9 Housing market January 2001 – August 2006 (housing starts to June) Sources: Statistics Norway, Norwegian Association of Real Estate Agents (NEF), Association of Real Estate Agency Firms (EFF), ECON and Finn.no House prices (NEF) (12-month rise. Per cent) Housing starts (number of 1000s in the last 12 months)

Norges Bank 10 CPI-ATE 1) Total and by supplier sector 2). Actual inflation and projections from IR 2/ month change. Per cent. July 2003 – August 2006 Sources: Statistics Norway and Norges Bank Goods and services produced in Norway (0.7) Imported consumer goods (0.3) CPI-ATE 1) CPI-ATE adjusted for the estimated effect of reduced maximum day-care rates from January ) Norges Bank's calculations.

Norges Bank 11 Different indicators of inflation 12-month change. Per cent. January 2002 – August 2006 Sources: Statistics Norway and Norges Bank Weighted median CPI-ATE 1) 20 per cent trimmed mean CPI 1) CPI-ATE: CPI adjusted for tax changes and excluding energy products. A further adjustment is made for the estimated effect of reduced maximum day-care rates from January 2006.

Norges Bank 12 CPI-ATE 1) Actual inflation and projections from IR 2/06. 4-quarter change. Per cent Q Q4 30%50%70%90% 1) CPI-ATE: CPI adjusted for tax changes and excluding energy products. A further adjustment is made for the estimated effect of reduced maximum day-care rates from January Sources: Statistics Norway and Norges Bank Average 12-month rise July-August

Norges Bank 13 Inflation expectations 1 year ahead 5 years ahead Source: TNS Gallup 1 year ahead 2 years ahead 5 years ahead Economists Employer and employee organisations

Norges Bank 14 CPI/HICP 12-month change. January 1997 – August 2006 Sources: Reuters EcoWin and national statistical offices US Euro area Japan UK Sweden

Norges Bank 15 Growth forecast Consensus Forecasts Source: Consensus Forecasts

Norges Bank 16 US - Housing market 12-month change. 3-month moving average. January 2000 – August 2006 (house prices to July) Price new dwellings Source: Reuters EcoWin Number of housing starts

Norges Bank 17 Oil price Brent Blend and futures prices Daily figures. USD per barrel. January September September 2006 Sources: Telerate, IPE and Norges Bank 22 June (IR 2/06)

Norges Bank 18 Metal prices USD. Indices, 1 January 2001 = 100. Daily figures. 1 January September 2006 Copper Nickel Aluminium Zinc Source: Reuters EcoWin

Norges Bank year yield in various countries Per cent. Weekly figures. Week – Week US Sweden UK Germany Norway Source: Bloomberg

Norges Bank 20 Sources: Reuters and Norges Bank US Euro area 25 September 2006 IR 2/06 (28 June) Sweden UK Actual and expected key rates as per IR 2/06 and 25 September 2006

Norges Bank 21 3-month interest rate differential and import-weighted exchange rate (I-44) 1) January 2002 – December 2009 Sources: Bloomberg and Norges Bank I-44 (right-hand scale) Weighted interest rate differential (left-hand scale) 28 June 06 (IR 2/06) 25 September 06 1) A rising curve denotes an appreciation of the krone. Average 1 – 25 September

Norges Bank 22 Krone exchange rate (I-44) Historical developments and projections from five different Inflation Reports Source: Norges Bank IR 2/05 IR 3/05 IR 1/06 IR 2/06 IR 2/04 1) A rising curve denotes an depreciation of the krone.

Norges Bank 23 Sight deposit rate in baseline scenario and market expectations regarding the sight deposit rate 1) Per cent Q3 – 2009 Q4 Market 25 September 2006 Market IR 2/06 Baseline scenario IR 2/06 Sources: Reuters EcoWin and Norges Bank 1) Derived from estimated forward rates. The sight deposit rate was reduced by a credit risk premium and technical difference of 0.20 percentage point. The grey shaded interval shows the highest and lowest interest rates in the market's sight deposit rate scenario in the period 12 – 25 September Market expectations concerning the sight deposit rate

Norges Bank 24 Monetary Policy Strategy - Inflation Report 2/06 The Executive Board's assessment is that the sight deposit rate should be in the interval 2¾ - 3¾ per cent in the period to the publication of the next Inflation Report on 1 November 2006, conditional on economic developments that are broadly in line with the projections. The interest rate may gradually – in small, not too frequent steps – be brought back towards a more normal level.

Norges Bank 25 Executive Board meeting 27 September 2006