rate will be set. it may be the case that as a result of the recent turmoil there has been more of a need than usual that the riksbank comments on the course of events, without anticipating the interest rate decision. assessing monetary policy now let us look back and discuss the material for assessing monetary policy, which came about on the initiative of the committee on finance. it is for me quite special this time. this is the first occasion on which the material for assessing monetary policy actually covers decisions that i have been party to. i do not intend to say a great deal about any conclusions in the material in this brief introduction. the point is that it is the committee on finance that assesses us. however, i would like to raise several issues of principle about assessment in general and about assessing monetary policy in particular. these issues have in various ways left their mark on the formulation of the material. for several reasons, it is important that we are assessed. as i mentioned earlier, one reason is that we become more efficient and develop our work methods. monetary policy acts with a lag and must therefore be based on forecasts. if we are to be as proficient as possible in forecasting future developments then we must continuously take heed and incorporate new knowledge, both new theories and everything else that is happening in the economy “ right now ”. one might say that it is similar to navigating with a nautical chart that is continuously being redrawn a bit. but it is not enough to have the latest shipping forecast and an up - todate chart in order to be a skilful skipper. in order to learn just how much the rudder needs to be adjusted in rough seas, one has to learn from experience. hopefully, one becomes more skilful at maintaining one ’ s course each time one has to parry. and, for monetary policy to be as efficient as possible, we must, in the same way, learn from past events. another reason concerns our role as an independent authority. it presupposes that the general public has ample opportunity to insight into our activities and that we are regularly examined. so assessment is important to us – both from an efficiency perspective and a democratic perspective. however, for the assessment to meet these purposes, there are a couple of factors to be taken into account. what can monetary policy achieve? to begin with, the demands – the actual base for the assessment – should be founded on what monetary policy can actually achieve. monetary policy

stefan ingves : introduction on monetary policy speech by mr stefan ingves, governor of the sveriges riksbank, at the riksdag's committee on finance, stockholm, 26 february 2008. * * * i would like to begin in roughly the same way as i did when i was last here – by saying a few words about the objective and basic purpose of monetary policy. it is in the light of this that we make our interest rate decisions. and our actions should be assessed against this background. our most recent economic assessment and the material for assessing monetary policy are also what we are here to discuss today. we must always bear in mind that the basis for monetary policy is the price stability objective which the swedish people, through the riksdag, have delegated to the riksbank. and this is actually not merely an objective, it is also a means. by keeping inflation low and stable, monetary policy shall help to create the best possible conditions for good and sustainable economic development. to do this in the best possible manner we must constantly learn from what is happening and try to become better at what we do. part of this process involves, of course, examining, assessing and discussing monetary policy in a constructive manner. here the riksdag committee on finance plays an important role, both in examining and in developing the examination process. the committee has recently taken several good initiatives. the most recent example was ordering the more detailed material for assessing monetary policy which the riksbank published about a week ago. i shall return to this assessment later. but first i would like to say a few words about current monetary policy. our most recent assessment our most recent interest rate decision was not an easy one. there is considerable uncertainty, for instance, on which direction international economic activity will take. and, as you are aware, we also had slightly differing opinions within the executive board. however, we must nevertheless make a decision and the majority of us reached the assessment that the repo rate should be raised to 4. 25 per cent. we are forecasting that the repo rate will remain around this level over the coming year. this type of interest rate development will contribute to inflation falling back and being around the 2 per cent target a couple of years ahead, at the same time as production and employment develop in a balanced manner. different forces are pulling in different directions in our decision we weighed together many different factors. a lot has happened ; both events that could push