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Norway's non-oil economy expanded for the fourth consecutive quarter during the April to June period, led by a strong recovery in the manufacturing sector, Statistics Norway said Thursday.
The mainland gross domestic product or GDP, which excludes crude oil and natural gas as well as services activities incidental to oil and gas, transport via pipelines and ocean transport, rose a seasonally-adjusted 0.5% quarter-on-quarter in the second quarter. Economists were looking for a 0.3% expansion.
This followed a 0.2% growth in the first quarter. The growth rate was revised up from 0.1% estimated initially. The fourth quarter figure was also revised up to 0.1% growth from a flat reading.
Overall gross domestic product rose a seasonally-adjusted 0.1% sequentially in the three-month ending June, while economists were looking for a 0.2% increase. The overall growth was, however, slightly slower than the 0.2% growth recorded in the first quarter, upwardly revised from a 0.1% decline.
Final consumption expenditure of households decreased 0.6% compared to the previous three-month period, while government spending rose 1.2%. Gross fixed capital formation grew 7.3% compared to a 10.4% contraction in the first quarter. Exports fell 2.4%, while imports grew 5.5%.
There was a considerable increase in both oil and mainland investments. The growth in gross fixed capital formation in mainland Norway was mostly driven by an increase in gross fixed capital formation in general government.
On an annual basis, total GDP rose 1.4% in the second quarter, while mainland GDP climbed 1.9%. Sequentially, both manufacturing and service-producing industries showed a marked increase in activity.
Domestic demand increased due to a rise in final consumption expenditure of general government and increased gross fixed capital formation, the statistical office said. The export of traditional goods rose after two quarters of close to zero growth rates, while a decrease in household expenditure dampened the increase in economic activity.
Value added in manufacturing rose 0.6% from the previous quarter. Chemical and mineral-producing industries in addition to wood and wood products industries were the strongest contributors to the expansion, Statistics Norway noted.
Electricity and gas supply contributed negatively to the mainland GDP growth as well as affecting the activity in production of other goods. Construction showed a significant increase in production, cushioning the fall in other goods' output.
Output of service-producing industries rose in the second quarter. Air transport was markedly affected by a ban on air traffic due to volcanic ash, that grounded flights in the whole of Europe.
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