October 8, 2018 / 6:11 AM / 11 days ago

Norway's 2019 fiscal budget to raise spending from wealth fund

OSLO, Oct 8 (Reuters) - Norway should continue to increase the spending from its sovereign wealth fund next year, the minority centre-right government said on Monday, while adding its proposed budget would have a neutral impact on economic growth.

The economy is set to grow at its fastest pace in six years in 2018 and will continue to see above-trend expansion in 2019 amid a recovery in the price of oil, Norway’s key export, according to forecasts by the government and the central bank.

Cash spending from the country’s sovereign wealth fund, the world’s largest with assets of more than $1 trillion, should rise to 231.2 billion Norwegian crowns ($28 billion) next year from 226.7 billion crowns this year, the government proposed.

The forecast for 2018 has been raised from 225.5 billion seen in May, the finance ministry said.

Norway’s mainland economy, which excludes volatile changes in oil and gas output, is now expected to grow by 2.3 percent in 2018, down from 2.5 percent seen in May, while 2019 growth is seen at 2.7 percent, up from 2.6 percent earlier.

$1 = 8.2643 Norwegian crowns Reporting by Terje Solsvik, editing by Gwladys Fouche

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