July is, together with February, the month of the year where the chains have the opportunity to regulate grocery prices. This happens after negotiations with the suppliers. In February, the figures showed the strongest price increase in over 40 years. Also in June, prices increased unusually much. The question is whether today’s figures will show a new record jump in the prices of food and drink. – Food prices are going to rise a lot. We expect them to rise by approximately 5 per cent on a monthly basis, and that is what will be the biggest contributor to price growth, says Kjetil Olsen, chief economist at Nordea. Price increases on packaging, energy, transport, target prices and increased production costs have found their way via the suppliers to Norwegian shop shelves. Photo: Simon Skjelvik Brandseth / news Flight tickets more expensive this summer The biggest price change for food and drink in one month was July 1981, when prices increased by 5.3 per cent. The series of figures examined goes back to 1979. In addition to the price development of food and drink, the economists are particularly concerned with how much air fares increased during the month. The pilot strike in SAS lasted most of July, and contributed to the scarcity and rise in prices of flights with other companies, including Norwegian. Interest rate meeting next week In June, Norges Bank raised the key interest rate by 0.5 percentage points, for the first time in 20 years. The question many are now asking is whether we will get another double interest rate jump from the central bank as early as next week. In Norges Bank’s monetary policy report from June, the central bank estimated that the so-called core inflation in July would rise by 3.2 per cent. Core inflation is the growth in consumer prices adjusted for changes in tax levels and energy prices. A stronger price increase than this, in isolation, will pull in the direction of a higher interest rate than what Norges Bank signaled at the June meeting. Then the central bank said that the interest rate would most likely be raised further by 0.25 percentage points in August. – We will look for signs of whether inflation is picking up, says Kjetil Olsen, chief economist at Nordea. Photo: Ketil Kern / news Nordea’s economists believe that it is most likely that the central bank will keep the interest rate plan from June, since it is a so-called intermediate meeting and a new economic analysis of the Norwegian economy (monetary policy report) will not be published. – It depends somewhat on what the numbers show. But normally one monthly figure is a bit too small to jump in the chair, says Olsen.
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Waiting for a price jump on food – news Norway – Overview of news from different parts of the country
