monetary policy measures ”, monetary policy report, february 2015, sveriges riksbank. some studies of the effects of complementary monetary policy in other countries include, for instance, weale, m. and wieladek, t. “ what are the macroeconomic effects of asset purchases ”, external mpc unit discussion paper no. 42, 2014, bank of england, gertler, m. and karadi, p. “ qe 1 vs. 2 vs. 3... : a framework for analyzing large - scale asset purchases as a monetary policy tool ”, international journal of central banking, bis central bankers ’ speeches pushed down and the exchange rate weakens – aggregate demand in the economy increases. when the economy is stimulated, inflation gradually rises, as companies can charge higher prices and the lower unemployment pushes up wages. a weaker exchange rate also leads directly to higher inflation, as prices of imported consumer goods rise faster. let me give an example of how the increase in the riksbank ’ s balance sheet in the form of government bond purchases can spread throughout the economy. when we buy government bonds, those who sell them receive liquid funds in the form of their bank account balance instead of the bonds they previously held. to improve the return on the portfolio, they must invest the liquid funds in some other assets, and the price of these assets will then be pushed up. this could be, for instance, corporate bonds or foreign government bonds. in the first case, companies could issue new bonds at more favourable rates. in the latter case, the exchange rate could weaken, which could lead to higher import prices and inflation and also benefit export companies. household indebtedness must be managed however, these measures are no “ free lunch ”. there are risks and costs linked to the very expansionary monetary policy. housing prices and household debts are now showing signs of increasing faster again. i have on several previous occasions emphasised how important it is that other policy areas ensure that these risks are managed. measures are needed to deal with the driving forces behind household indebtedness, such as reforms to increase housing construction, but also further macroprudential policy measures. with regard to macroprudential policy measures, it is worrying that finansinspektionen ’ s amortisation requirement could not be implemented as planned. it is important, not least with regard to the recommendation from the esrb i mentioned earlier, that the responsible authority has control over the

appropriate tools to attain its objectives. i therefore consider it very important that finansinspektionen ’ s mandate should be clarified and that the conditions for an amortisation requirement are investigated as quickly as possible. when it comes to the costs of the expansionary monetary policy, there is also a risk that losses will arise on the riksbank ’ s balance sheet as a result of the bond purchases. in pure accounting terms, the bond portfolio will be booked at market value. this means that the value of the portfolio will vary as interest rates change. the cost of funding the holdings will therefore increase when short - term interest rates eventually rise. if the riksbank were to suffer a loss, however, it would not entail any particular problem, but it would lead to the surplus we pay to the state every year declining. there will thus be less money for the swedish treasury. we have nevertheless chosen to take these measures to emphasise that we want to safeguard the role of the inflation target as nominal anchor for price - setting and wage formation. moreover, we have said that if more is required to get inflation to rise towards the target, we will do more. and we are prepared to do so with force. 2012 and christensen, j. h. e. and krogstrup, s. “ swiss unconventional monetary policy : lessons for the transmission of quantitative easing ”, federal reserve bank of san francisco working paper 2014 – 18. bis central bankers ’ speeches concluding reflections in my speech today i have tried to describe current monetary policy from an historical perspective. i hope that you have gained a deeper understanding of current monetary policy. the objectives and means of central banks have changed over time, usually as a result of economic crises. this has led to rethinking of the prevailing consensus view of monetary policy. experiences from the 1990s crisis showed the importance of having a credible nominal anchor, which led to an increased element of “ norm - based thinking ” in monetary policy. for the riksbank, this resulted in the inflation - targeting regime we have now. with regard to the experiences of the most recent global financial crisis, we are to some extent still on a learning curve. but personally, i think that one important lesson is that financial stability is a necessary condition for macroeconomic stability and price stability. developments in the wake of the financial crisis have also shown how dependent sweden ’ s economy is on developments abroad. i think that current monetary policy reflects all of these lessons