Norges Bank’s economic forecasts for the Norwegian economy for 2018 and 2019 were close to the mark and the forecast errors were mostly smaller than for the preceding 20 years. The evaluation for 2018 and 2019 indicates that the forecasting system captured the main features of economic developments. The forecast errors from simple models were also smaller than normal.

For some of the variables, there has been a tendency of systematic forecast errors over time. If we look at the period after the oil price collapse in 2014, wage growth, productivity and the exchange rate have shown weaker-than-expected developments. Overall, it would appear that we underestimated the decline in the ability to pay wages in Norway.