Norges Bank 1 Executive Board meeting 25 January 2006

Norges Bank 2 Growth forecast Consensus Forecasts Source: Consensus Forecasts

Norges Bank 3 CPI core 1) 12-month change. January 1999 – December 2005 US Sweden Euro area UK 1) US: CPI excl. food and energy Euro area, UK and Sweden: CPI excl. energy, food, alcohol and tobacco Source: EcoWin\ Eurostat

Norges Bank 4 Actual and expected key rates 1) Sources: Reuters and Norges Bank US Euro area 23 January December 2005 Sweden UK 1) Not adjusted for credit risk

Norges Bank 5 Long-term real interest rates 1) Week – week Source: Ecowin US (2029) Sweden (2020) France (2029) UK (2055) Japan (2014) UK (2030) 1) Maturity dates in brackets

Norges Bank 6 Differential between US 10-year and 3-month yields Monthly figures. Per cent Source: EcoWin

Norges Bank 7 Developments in international equity indices Total return. Indices, 3 January 2005 = January 2005 – 23 January 2006 Source: EcoWin

Norges Bank 8 International commodity prices in USD Indices, Week = 100. Week – Week Source: EcoWin / The Economist Agricultural products excl. food Metals Manufacturing

Norges Bank 9 Oil price Brent Blend and futures prices USD per barrel 23 January 2006 Sources: Telerate, IPE and Norges Bank 27 October (IR 3/05)

Norges Bank 10 3-month interest rate differential and import-weighted exchange rate (I-44) 1) Monthly figures. January 2002 – January 2006 Sources: Bloomberg and Norges Bank I-44 (right-hand scale) Weighted 3-month interest rate differential (left-hand scale) 23 January December ) A rising curve denotes a stronger krone exchange rate

Norges Bank 11 CPI-ATE 12-month change. Per cent. Broken lines are projections from IR 3/05 January 2004 – December 2005 Sources: Statistics Norway and Norges Bank Goods and services produced in Norway (0.7) 1) 1) Norges Bank's calculations Imported consumer goods (0.3) CPI-ATE

Norges Bank 12 Various inflation indicators 12-month change. Per cent Source: Statistics Norway Weighted median CPI-ATE 20 per cent trimmed mean CPI

Norges Bank 13 Goods consumption index Seasonally adjusted index. January 2004 – November 2005 Sources: Statistics Norway and Norges Bank

Norges Bank 14 LFS (left-hand scale) Registered unemployed (right-hand scale) Number of unemployed In thousands. Seasonally adjusted Sources: Directorate of Labour, Statistics Norway and Norges Bank

Norges Bank 15 Credit growth Total debt mainland Norway (C3). Domestic credit to households (C2) 12-month change. Per cent Sources: Statistics Norway and Norges Bank Households (C2) Total debt non-financial enterprises mainland Norway (C3) Total debt mainland Norway (C3)

Norges Bank 16 House prices and housing starts Housing starts measured as total over 12 months. In thousands 12-month change in house prices. Per cent January 2000 – December 2005 Housing starts 1) House prices 1) Last observation is November Sources: Associations of Norwegian real estate agents (NEF, EFF) and Statistics Norway

Norges Bank 17 Non-residential building starts Area (1000 m 2 ). 3-month moving average January 2001 – November 2005 Manufacturing Retail trade Property management Leisure property Source: Statistics Norway

Norges Bank 18 Norges Bank's and the market's overnight deposit rate scenario 1) Interest rate scenario IR 3/05 Market 23 January 2006 Market 13 December 2005 Sources: Norges Bank 1) The black and blue lines indicate market participants' interest rate expectations on 13 December 2005 and 23 January 2006 respectively. A credit risk premium and technical difference of 0.20 percentage point were deducted in calculating the sight deposit rate. The grey, shaded interval shows the highest and lowest interest rates in the market's sight deposit rate path in the last 10 days up to 23 January.

Norges Bank 19 Baseline scenario in Inflation Report 3/05 Import- weighted exchange rate, CPI-ATE Output gap Sight deposit rate

Norges Bank 20 Monetary Policy Strategy - Inflation Report 3/05 "The Executive Board's assessment is that the sight deposit rate should be in the interval per cent in the period to the publication of the next Inflation Report on 16 March 2006, conditional on economic developments that are broadly in line with the projections." The Executive Board's assessment is that the interest rate may gradually, in small, not too frequent steps, be brought back towards a more normal level. The objective of bringing inflation back to target and anchoring inflation expectations nevertheless implies that monetary policy remains expansionary.