We have also increased the forecast range of the annual average key rate for the next year by 1.3 percentage points, as compared to July. Considering such policy, inflation will decline to 4.0–4.5% next year. I will now speak of the economic situation. Except oil production subject to the OPEC+ cuts, the economy generally bounced back to its long-term growth trends in the second quarter and even exceeded them in a number of industries. Growth slowed down in the third quarter, which is evidence that the recovery had completed. It should be noted that the third quarter GDP was affected by a decrease in harvest and the worsened epizootic situation. Excluding agriculture, we estimate that GDP growth quarter-on-quarter was positive. Consumer demand remains the main contributor to the growth. One-time payments to households also supported consumption. The surveyed companies expect a further expansion of demand. According to the data on GDP for the second quarter and recent statistics for the third quarter, gross fixed capital formation also grows fast this year, and even faster than we assumed in our July forecast. The oil industry is a large sector where there is still a substantial space for the recovery growth. The OPEC+ is gradually easing the oil production cuts. Furthermore, the environment in the global markets of energy commodities has improved considerably. We have raised the forecast oil price for 2021 and 2022, specifically to 70 and 65 US dollars per barrel, respectively. I will now briefly talk of the situation in the labour market.
Svein Gjedrem: Trade-offs in monetary policy Address by Mr Svein Gjedrem, Governor of Norges Bank (Central Bank of Norway), at the Centre for Monetary Economics/Norwegian School of Management, Oslo, 6 June 2006. Please note that the text below may differ slightly from the actual presentation. The address is based on the assessments presented at Norges Bank’s press conference following the Executive Board’s monetary policy meeting on 31 May, Inflation Report 1/06 and on previous speeches. The  Charts in pdf-format can be found on the Norges Bank’s website. *  *  *  Low prices for imported consumer goods, combined with high prices for our commodities exports, have contributed to a strong improvement in Norway’s terms of trade. The contribution from the rise in oil and gas prices is particularly high, but the terms of trade for the mainland economy have also improved. The Norwegian economy has been exposed to a strong positive income shock. So far, the increase in income has not led to markedly higher price and wage inflation. Businesses are using resources with steadily greater efficiency and the supply of labour has been ample. Partly owing to the improvement in the terms of trade, the exchange rate has remained strong, which has contributed to keeping inflation low. In the face of such strong external influences, smoothing developments in the Norwegian economy is a demanding task.