17.11.2025
Norway’s economy is projected to record weak growth in 2025 after a contraction in the first half of the year driven by a negative contribution from net exports. Real GDP growth is forecast at 0.5% in 2025, before strengthening to 1.2% in 2026 and 1.4% in 2027 as private consumption and investment recover. Inflation is expected to moderate over the forecast horizon, while public finances are projected to remain firmly in surplus and public debt to decline.
| Indicators | 2025 | 2026 | 2027 |
|---|---|---|---|
| GDP growth (%, yoy) | 0.5 | 1.2 | 1.4 |
| Inflation (%, yoy) | 2.9 | 2.3 | 2.5 |
| Unemployment (%) | 4.4 | 4.2 | 4.1 |
| General government balance (% of GDP) | 12.3 | 11.9 | 11.3 |
| Gross public debt (% of GDP) | 49.9 | 44.0 | 38.8 |
| Current account balance (% of GDP) | 11.5 | 10.1 | 10.0 |
External sector drag weighs on activity in 2025
Economic activity contracted in the first half of 2025, mainly due to a negative contribution from net exports as exports fell while imports increased moderately. Investment also declined, though the fall eased compared to the previous year, while private consumption accelerated on the back of higher real disposable incomes.
Domestic demand to strengthen in 2026–27
Private consumption growth is expected to strengthen further, supported by higher real wages, employment and improved confidence. Investment is projected to recover, with a rebound in housing investment expected to become a key driver later in the forecast horizon, while business investment benefits from slightly lower interest rates. Net exports are projected to contribute negatively to growth as imports outpace exports amid pent-up domestic demand.
Inflation expected to ease but remain a key risk factor
Inflation is expected to moderate over time, but currency movements and import prices remain important determinants. A depreciation of the krone could reignite inflationary pressures and slow household consumption.
Public finances remain strong
Government finances are projected to remain very strong, with the overall balance firmly in surplus and public debt declining over the forecast horizon.
Source: European Commission. European Economic Forecast, Autumn 2025.
