Norway’s statistics office reported this week that the nation’s economy saw no growth over the second quarter of this year, as soaring inflation and rising interest rates weighed down consumer demand.

Mainland gross domestic product (GDP), excluding the nation’s offshore industry, stalled in comparison to the previous quarter, remaining at 0.2% after a number of industries underperformed, according to the  data.

The biggest force weighing down the nation’s GDP in the second quarter was the construction sector, due to a slump in investments in housing, according to the data.

Frank Jullum, an economist at Danske Bank A/S said, “Growth is clearly coming down and has been below trend in the first half, driven mainly by a slowdown in private consumption and residential investments on a cocktail of higher rates and negative real wage growth.”

Norway has faired better economically in the face of the prevailing economic headwinds of the rampant cost of living crisis than its neighbors in the Nordic region so far, proving more resilient due to its wealth in fossil fuel resources. However regardless, its GDP underperformed over the second quarter compared to estimates from Norges Bank, according to economists.

The country has seen 12 interest rate hikes since 2021 courtesy of the country’s central bank, as it has battled to rein in a persistent inflation which has been slowing the economy.

In June, the OECD warned in a report that “high inflation and policy tightening are weighing on domestic demand,” adding that Norwegian economic output in 2024 would remain moderated.