Norway and Germany see economic slumps in August

Norway and Germany both saw economic decline in August - Copyright Canva/studiocasper from Getty Images Signature

Published on 09/10/2023 - 12:01

Norway’s economy has shrunk for the first time in four months as Germany's industrial output fell for the fourth consecutive month.

Norway's mainland GDP fell by 0.2% in August, according to Statistics Norway, the country's official statistical office, undoing the 0.2% rise that Oslo saw in July.

Wholesale and retail trade contributed the most to the fall, the agency said, but the administrative, agriculture, forestry and fishing sectors also dipped.

Real estate activities moderated the decline, according to Statistics Norway.

"We are seeing a fairly flat development in the Norwegian economy so far this year," Norway's head of national accounts, Pål Sletten, said in a statement.

Statistics Norway warned against seeing the dip in GDP in August as anything calamitous.

"If you look at several months together, this can give a better impression of the underlying development in the economy," it said. "The rolling three-month growth shows modest growth for GDP Mainland-Norway of 0.2 per cent from March-May to June-August."

The news comes as countries across Europe continue to grapple with rising inflation and the cost of living crisis.

In Germany, the Federal Statistical Office announced on Monday that its industrial output had fallen by 0.2% in August for the fourth consecutive month.

Output is also down 2% compared to August 2022, the agency said.

It noted that a a 2.4% drop in construction production and a 6.6% drop in energy production, both from the previous month, had the biggest negative impact on overall performance in August 2023.

"The decline observed in the manufacture of machinery and equipment by 2.3% was also an important contributor to the overall result," the office said. "By contrast, the growth in production in the automotive industry (+7.6%) had a positive impact on overall performance. This follows a decline of 9.4% in this sector in July 2023."

On the flipside, production was up in energy-intensive industrial branches, which increased by 0.9% in August 2023 from July 2023, according to the Federal Statistical Office.

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