, it is partly because we have undergone an adjustment from a high - inflation to a low - inflation regime, which affected policy in large measure during the first of those three episodes, and partly because inflation on different occasions has been depressed by supply factors that neither we nor others have been able to predict. allow me to conclude the retrospective part of this speech by underlining that i value an open, lively debate on monetary policy. i have previously pointed out before the committee that we would be happy to come here more often and that we are open to other forms of discussion than this one. if the committee ’ s members have ideas to improve the material that we present, we would be interested in hearing them. the riksbank is also considering initiating an annual forum for monetary policy debate, where our assessments and policy can be discussed against the background of regular independent evaluations of the forecasts that we – and other participants in the general debate – have produced. the current assessment cyclical upswing continuing with that i shall now look forward and briefly discuss the assessment of economic and inflation prospects in our latest inflation report and the decision we took yesterday regarding the repo rate. as usual i shall begin with a brief look at the international situation. economic growth abroad has remained high. there are many indications that international economic activity will continue to strengthen in the period ahead and that resource utilisation will gradually pick up. high productivity growth and weak resource utilisation have kept down cost developments in a number of industrialised countries. coupled with the increased integration of low - cost countries into world trade this has contributed to low global inflationary pressures. in the period ahead, price pressures are expected to remain modest even though they will increase as economic conditions improve and there is a reduction in spare production capacity. that means that market interest rates are also anticipated to rise from today ’ s unusually low levels. there are positive signals emanating from the us economy while the euro area, and notably germany, has seen somewhat weaker growth than expected. ( figure 6. ) overall, growth in sweden ’ s export markets is forecast to be largely the same as in the previous inflation report. the swedish economic recovery began in 2003 and it is predicted to continue during the forecast period. in 2004 robust international demand for swedish exports contributed to the high economic growth. manufacturing activity now appears to be entering a slightly slower phase. indicators and data point to a continuation of firm, healthy growth, albeit at a somewhat lower rate than in early 2004

4. 5 4. 0 4. 0 3. 5 3. 5 3. 0 3. 0 2. 5 2. 0 1. 5 1. 0 jan - 02 2. 5 m arch 2002 august 2002 m arch 2003 august 2003 nier's repo rate repo rate 2. 0 1. 5 1. 0 jul - 02 jan - 03 jul - 03 jan - 04 jul - 04 sources : nier and the riksbank 5. und1x and cpi annual percentage change und1x cpi - 1 - 1 - 2 - 2 sources : statistics sweden and the riksbank 6. gdp for the united states and euro area annual percentage change gdp, united states - 1 - 1 forecast united states - 2 - 2 gdp, euro area - 3 forecast euro area - 3 sources. eurostat, the us department of commerce and the riksbank 7. und1x : outcome and forecast in the main scenario annual percentage change 4. 0 4. 0 und1x inflation report 2005 : 1 inflation report 2004 : 4 3. 5 3. 0 3. 5 3. 0 2. 5 2. 5 2. 0 2. 0 1. 5 1. 5 1. 0 1. 0 0. 5 0. 5 0. 0 0. 0 - 0. 5 - 0. 5 - 1. 0 - 1. 0 sources : statistics sweden and the riksbank table 1. gdp by expenditure annual percentage change gdp by expenditure private consumption government consumption gross fixed capital formation change in inventories exports imports gdp at market prices 1. 5 0. 8 1. 8 0. 3 2. 7 1. 2 3. 0 1. 4 3. 3 0. 6 - 1. 5 5. 1 8. 0 5. 8 4. 5 0. 2 4. 9 - 0. 3 10. 2 6. 7 0. 0 6. 6 7. 5 0. 0 6. 1 6. 6 0. 0 6. 0 6. 7 1. 5 3. 5 3. 2 3. 2 2. 8 sources : statistics sweden and the riksbank