payments. the bundesbank will soon be tackling this topic in its monthly report. 3 central bank digital currency in cross - border payments nowadays, a large proportion of cross - border payment transactions are conducted through correspondent banking. during settlement, a payment often moves from bank to bank on its way to the final payee via very long transaction chains. throughout this process, neither the duration of the individual processing steps nor the associated fees are transparent for users. often, they can only be quantified once the credit transfer has been completed. the situation is not made any better by the fact that more and more correspondent banks are withdrawing from international payments – partly because the costs of preventing money laundering and terrorist financing have increased considerably. in addition, there is a risk that individual regions or currencies will be largely cut off from international payments. cbdc ( central bank digital currency ) now opens up the possibility of designing settlement systems for payment transactions in such a way that cross - border payments can be processed more cheaply, faster and more efficiently than with current payment systems. to this end, central bank digital currency systems in different currency areas need to be designed so that they enable interoperability. put simply, the systems need to be able to talk to each other so that business can be conducted across systems. this requires close coordination between central banks. however, implementation even in a single currency area alone is complex and fraught with many challenges, not to mention the time dimension. good things take time. so when we talk about the interoperability of cbdc ( central bank digital currency ), we are looking at a medium - term goal. but this opportunity should be taken nonetheless, because central bank digital currency is not just a means of payment – it also requires a new settlement infrastructure. most central banks around the world are contemplating central bank digital currency. many are considering building a new settlement structure for it. given the right cooperation, this offers a historic opportunity to ensure interoperability from the outset. in principle, there are two approaches to making cbdc ( central bank digital currency ) usable for cross - border payments. on the one hand, a unilateral approach would be conceivable : in other words, issuing digital currency according to one ’ s own rules “ without looking around ” and – like cash – also making it available to holders abroad. on the other hand, one could take a multilateral approach that would rely on cooperation with other central banks. a un

with monetary policy. if monetary policy seeks to pursue goals beyond its reach, the credibility of monetary policy will gradually weaken. regulation and oversight of financial institutions must therefore continue to be the first line of defence against shocks to the financial system. the regulation of norwegian banks largely follows eu rules, which in turn are governed by guidelines decided by the basel committee. generally, we have been able to implement stricter regulation more rapidly than most other countries, partly because the economic downturn in norway has been relatively mild. the ministry of finance has also introduced residential mortgage lending regulations to slow down the increase in house prices. conclusion i believe both international and our own experiences with inflation targeting have been predominantly positive. while the exchange rate targeting regime that prevailed until the late 1990s tended to function procyclically, flexible inflation targeting has contributed to stabilising the economy when it has been exposed to shocks. in norway, we can now look back on a quarter of a century of price stability. at the same time, employment has shown less variation since 2001 than in previous periods, in spite of the substantial disturbances that have hit the norwegian economy. in the early years of inflation targeting, policymakers had high ambitions of fine - tuning inflation to meet the target and of achieving this goal within a clearly defined time horizon. but useful lessons have been learned. in the face of various kinds of shocks, small open economies in particular found that bringing inflation rapidly back to target can have undesirable consequences for the real economy. it has been essential to practise flexibility in inflation targeting to address shocks. the horizon for achieving the target has been lengthened. the latest adjustment of the mandate for monetary policy in norway clarifies this flexible interpretation of the inflation target. we believe the framework is well suited to guiding monetary policy through the years ahead. 3 / 3 bis central bankers'speeches