The companies in Norges Bank’s regional network estimate wage growth of 4.5 per cent in 2025. This is higher than the expected price increase – which means that households will have better purchasing power. – Many of the companies with the highest wage expectations are experiencing high activity and good profitability, says the press release published on Thursday morning. The regional network provides an indicator of how the business world is doing. The activity in the Norwegian economy is important when Norges Bank decides the level of the key interest rate. On Thursday next week, Norges Bank will present the interest rate decision and monetary policy report. Chief economist Harald Magnus Andreassen at Sparebank 1 Markets believes the fresh figures from the regional network may contribute to fewer interest rate cuts next year. He believes that the first interest rate cut will come in March next year, and that there will be three interest rate cuts in the course of next year – not three or four, as is the current estimate. – We were surprised that the companies have now revised up the expected wage increase next year to 4.5 per cent, which is up 0.2 percentage points from the previous survey, he says. Chief economist Kyrre M. Knudsen at Sparebank 1 Sør-Norge believes that companies’ expectations of higher wage growth may mean that we have to wait longer for the first interest rate cut. – If Norges Bank assumes the same, this could lead to an interest rate cut later than March, he says.
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