(Corrects in 1st, 3rd and 9th paras to attribute data and forecasts to the statistics agency (not the govt))
* S/a Q4 non-oil GDP up 0.3 pct q/q vs fcast 0.8 pct
* S/a non-oil GDP down 1.5 pct yr/yr in Q4
* Analysts bearish on March rate rise, eye May move instead
* Crown weakens after data from 17-month high
By Aasa Christine Stoltz
OSLO, Feb 18 (Reuters) - Norway's non-oil gross domestic product grew by just 0.3 percent, seasonally adjusted, in the fourth quarter, missing forecasts due to weak exports and business investment and prompting the statistics agency to cut its growth forecast for this year.
The data also prompted analysts to scale back expectations for the timing of the next rate rise to May rather than March and pushed the Norwegian crown down from a 17-month high.
Releasing the data on Thursday, the statistics agency said it now sees Norway's non-oil GDP growing 2 percent in 2010, down from 2.2 percent in a December estimate. Including the oil and gas sectors, it now forecasts full-year overall GDP growth of 1.5 percent, down from 1.7 percent previously.
The crown, which hit a 17-month high against the euro
Compared with a year ago, the economy contracted 1.5 percent.
Norway, one of the first Western economies to raise interest rates since the global financial crisis, increased borrowing costs twice in the fourth quarter of 2009, to 1.75 percent, and is expected to continue to gradually hike rates this year, saying in February that its next rate rise was likely in March or in May.
"Both the crown and this data weigh in favour of pushing the next interest rate rise forward to May from March," said senior economist at DnB NOR Markets, Kyrre Aamdal.
The crown has strengthened around 6 percent since the start of December, according to Reuters data, helped by rising oil prices and expectations for further rate rises.
The statistics agency raised its forecast for core consumer inflation this year to 1 percent, from 0.7 percent in a December estimate.
Thursday's data showed that overall GDP, which includes the Nordic country's vast offshore oil and gas sectors, also disappointed, growing by 0.1 percent quarter-on-quarter. That was less than the 0.7 percent rise predicted by analysts and down from a revised 0.5 percent in the third quarter.
Compared with a year earlier, overall GDP fell 1.2 percent.
Economists said private consumption was still strong, but that business investments and exports were weaker than expected.
Norway's economy has weathered the economic downturn better than most Western economies including its Scandinavian neighbours, largely helped by massive stimulus measures and numerous central bank rate cuts which pushed the key rate to a record low 1.25 percent.
On March 24, the central bank will publish the first of three monetary policy reports of the year, where it predicts the development in rates, and economists say it is likely to forecast a "cautious" rise in its key rate.
"This will increase the probability for a more cautious pace in the interest rate path in the upcoming monetary policy report," said chief analyst at Nordea Markets, Erik Bruce. (Additional reporting by Ole Petter Skonnord; Editing by Susan Fenton)