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Norway jobs data raises focus on Norges Bank, with core inflation eyed

The July nonfarm payroll report showed payrolls at -23,000 and the unemployment rate at 4.1%, while attention turns to Norway core inflation expected at 2.9% in July and the Norges Bank decision Thursday.

Reported · Written up by our desk · Central Banks

Action Forex said a weak US July jobs report is in focus, with nonfarm payrolls at -23,000 versus expectations of +80,000, and cumulative revisions for May and June coming in at -103,000. The unemployment rate fell to 4.1%, and the labour market participation rate declined to 61.4%, the weakest level since February 2021.

For Norway, the outlet expects core inflation to rise to 2.9% in July, with the increase tied to a partial rebound in information and communication technology and higher airline ticket costs. It also expects lower food inflation to offset the rise slightly, which would leave core inflation about 0.4 percentage points below the level assumed by Norges Bank in its June monetary policy report.

Action Forex expects that scenario would mean Norges Bank stays on hold on Thursday, while retaining a tightening bias. The brief also flags that Denmark’s July inflation data is due, headline euro area data will include the Sentix investor confidence release, and it expects the Reserve Bank of Australia to keep its cash rate unchanged at 4.35%.

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