– We have sold the car because the prices of fuel went up so enormously. We have instead resorted to using a bus, says Charlotte Nettum. She and her husband are shopping at a shopping center in Arendal. In the shopping bags they have boots for one of the three children and underwear. – So now you are on foot. How does it work? – It works well. After all, we have three children who go to nursery school, so luckily the logistics work out. Fortunately, the bus service is good. It is cheaper, significantly cheaper, to take a bus, says Lars Erik Nettum. Record pessimism For Norwegians, electricity bills, food bills and other goods that are increasing in price are taking a heavy toll on their wallets. And they clearly believe that things will go from bad to worse. In Finans Norges and Kantar Public’s recent barometer of expectations, people’s expectations of their own finances fall to a record low level. – People have a pessimistic view of their own finances next year. Now we are seeing a historic shift, says CEO of Finans Norge Idar Kreutzer. DEVELOPMENT: The graph shows the development of economic expectations from 1992 to 2022. Graphic: FINANCE NORGE/KANTAR PUBLIC Norwegians have consistently had good faith in their own economy in the coming year. The pessimism now is much stronger than during the financial crisis, the oil crisis and the pandemic. And that despite the fact that the Norwegian economy is doing well. Unemployment is low and companies are struggling to get enough people. Nevertheless, wages have not kept pace with the rise in prices. – It probably means that what we are seeing with higher electricity prices, higher food prices, interest rate jumps that have started to come has an effect, but the results are much greater than we had expected, says Kreutzer. Warns against too high interest rates Now the head of Finans Norge is afraid that Norges Bank, which has announced that interest rates will be increased by almost two percentage points, will be too aggressive with the interest rate screw. – What we fear is that we are now seeing a sudden shift in private consumption in Norway. We know that private consumption is important for the Norwegian economy, says Kreutzer. WARNING: Administrative director of Finans Norge, Idar Kreutzer, warns against excessively high interest rates. Photo: Trond Lydersen / news He believes the big question is whether this pessimism results in lower consumption, which means that interest rate increases are not necessary. – This is a marked shift that I am sure that Norges Bank will take into account when they make their assessments. It is important not to introduce braking measures after the train has started to stop, warns Kreutzer. Norges Bank is expected to increase the key interest rate on Thursday. Savings The Nettum family is now cutting back on consumption so that next year will be easier. – How do you see next year? – We try to save where we can, says Charlotte Nettum. – We are also trying to save up for next year, so that we can have a little more room in the economy. Because right now it’s very tight, she continues.
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