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Fast Comment NorwayManufacturing output rose slightly more than expected in April

  1. Manufacturing output rose 1.1 percent in April vs. expectations of 0.7 percent
  2. A positive start to Q2 following a surprisingly weak performance in Q1
  3. We maintain a positive outlook
Manufacturing output rose 1.1 percent in April vs. expectations of 0.7 percent
Data for manufacturing output in April have just been released. Recall that output was surprisingly weak in Q1, declining by 1 percent q-o-q. This was driven by a decline in January, as output was broadly flat through February and March. However, our understanding was that the underlying tendency was more positive than indicated by the latest hard data. Accordingly, we anticipated a positive start to Q2; we and consensus expected output had increased by 0.7 percent m-o-m in April. The outcome was somewhat stronger, as output rose by 1.1 percent. As shown in the chart below, the trend is pointing upward, albeit modestly. Digging into the details, we note that some of the sectors that contributed to the weak performance in Q1 recorded monthly gains in April. On the other hand, repair and installation of machinery saw a decline in activity in April. The decline in this industry was partly related to the completion of some large projects. While the result is a bit mixed, as always, our key impression is that the manufacturing sector as a whole improved at the start of Q2. We maintain a positive outlook given the backdrop of rising petroleum investments, solid global growth and the NOK still being weak.


Disclaimer

Marius Gonsholt Hov

Senior Economist

Norway

maho60@handelsbanken.no

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