The Norwegian inflation rate surprised on the topside of our expectations and even if we had penciled in a large increase of >2.5% MoM food-flation, we still got a hawkish surprise from the necessity categories.

3.26% MoM in food is a pretty big surprise, but we also saw a minor positive surprise in the energy category. Very headline driven surprise! On the other hand, services where labor dominates printed at a mere 0.23% MoM. Is this a sign of goods-flation / neccesity-flation returning?

We see the similar risk ahead of next week in the US with large potential surprises in the food category given our now-casts and the typical lead/lag from input costs (see char 1b).

Chart 1a: Decomposed Norwegian inflation in April..

Chart 1b: Food prices likely to surprise sharply to the upside in the US as well