stressed the risk that growth may again prove to be weaker than projected. for several of norway ’ s main trading partners, inflation is close to zero. the low level of inflation is partly the result of the fall in many manufacturing and commodity prices, including oil prices. in addition, cost pressures in many countries are moderate after several years of high unemployment and low wage growth. chart : money market rates for trading partners the low level of inflation has led central banks to implement further monetary policy easing over the past year. policy rates are now negative in a number of countries. in addition, several central banks have introduced other instruments to stimulate economic activity and mitigate the risk of deflation. the european central bank ( ecb ) has expanded its asset purchase programme to include government bonds. the riksbank, the central bank of sweden, introduced a government bond purchase programme at the beginning of last year. on the other hand, the federal reserve raised its policy rate for the first time in nine years in bis central bankers ’ speeches december 2015. trading partners ’ policy rates can be expected to remain low for a long period ahead. external developments influence the norwegian economy through several channels : through demand for norwegian goods and services, through financial markets and the exchange rate and, not least, through commodity prices. chart : oil prices the fall in oil prices began in summer 2014 and continued through 2015. oil prices have picked up again somewhat in recent months to just over usd 45 per barrel, but are still at less than half of their pre - fall level. futures prices have also decreased in the past year. these prices now indicate only a moderate rise in oil prices ahead. the decline in oil prices partly reflects large oil supply surpluses and lower demand for oil in china and other emerging economies experiencing weaker growth. the effects of the fall in oil prices on the norwegian economy gradually became evident through 2015 and were particularly pronounced in regions and sectors closely linked to the oil industry. chart : petroleum investment the most direct channel through which the fall in oil prices is transmitted to the economy is via the supply of intermediate goods and services to the petroleum industry. oil companies have postponed or cancelled a number of development projects on the norwegian continental shelf as a result of the decline in oil prices and have implemented a range of measures to reduce operating and maintenance costs. total petroleum investment fell by 15 percent between 2014 and 2015. at the same time, lower demand from the global petroleum industry has led to a decline in norwegian oil service exports. the decrease

labour force. at the same time, improved terms of trade will led to higher activity in the norwegian economy. capacity utilisation is expected to revert to a normal level in the second half of 2011. in the coming years, output in the mainland economy is expected to increase at an annual rate of 3 – 4 per cent. a strong krone and low external price impulses will continue to have a dampening impact on inflation, and inflation will remain below target for some time. further ahead, higher capacity utilisation and profitability in the business sector point to a pickup in wage growth. at the same time, the fall in import prices will slow. to conclude : norway has weathered the financial crisis better than most countries, and the economic recovery in norway is now on a firm footing. currently, interest rates are low, with the key policy rate at 2 per cent. in the years ahead, there are prospects for fairly strong growth in the norwegian economy, driven by solid income growth, rising investment and high population growth. on balance, the consideration of stabilising inflation, as well as developments in output and employment, imply a gradual increase in the key policy rate towards a more normal level. thank you for your attention. bis central bankers ’ speeches