for example, bottleneck problems in the labour market and signs of difficulties in recruiting skilled labour. other signs are an increased propensity to resort to labour disputes, either regular strikes or wildcat behaviour. moreover, firms may have to compromise over job qualifications and take on less skilled personnel in order to cope with demand for their goods and services. some such signs have been observed in recent months. firms are already finding it difficult to recruit computer consultants, for instance, as well as some other categories of personnel. the situation in some parts of sweden is also more strained than elsewhere. this suggests that firms will find it increasingly hard to keep up with demand for their products. in other words, a situation where demand is rising too rapidly. to date, however, the bottleneck problems are fairly limited. thus, there are still no signs of more widespread shortages that might generate unsettling inflationary impulses ; but the risk spectrum has shifted. moreover, the situation can change at short notice and the riksbank has to be alert to this. we must be ready to take preventive action. in earlier upward phases, in the 1970s and 1980s, a tightening of economic policy often came too late. the normal result was that the growth of production and employment was checked and unemployment rose. that must not happen this time. the purpose of normalising the repo rate in time is to bring gdp growth into line with the path for long - term growth, with a continued increase in employment and as low a level of unemployment as the structure of the economy allows. this is the starting point as we face the future challenges to monetary policy. that is what is meant by price stability. it is also how we, as members of the executive board, perceive the task assigned to us by the riksdag.

the 1970s. the value of independence how can one then construct a framework for monetary policy that provides the central bank with the best possible conditions to carry out its tasks? here i intend to be fairly brief as this is something that will be discussed in more detail in the next contribution to this conference. let me just note that there is currently general agreement that the central bank should be given the opportunity to work independent of the political system in order to attain the objective of price stability. it has been observed that if monetary policy is conducted at arm ’ s length from party politics, there is greater confidence in the price stability objective. this is linked to the fact that there has often been a tendency for politicians to use monetary policy for more short - term purposes which have conflicted with the long - term price stability objective and which have often entailed loosening the nominal anchor. making the central bank independent is probably the element of the past decades ’ monetary reform process that has triggered the most debate and has been perceived as the most controversial. it is probably natural for politicians to feel uncomfortable giving the central bank increased independence as it unavoidably means that they give up some of their decision - making powers, and moreover in a field perceived to be central. i assume that this is one explanation why, for instance, it took sweden until 1999 before there was sufficient political support to grant the riksbank increased formal independence and to confirm by law the price stability objective, despite the fact that these reforms had been proposed when the inflation target was introduced in 1993. however, the concern among politicians over making central banks independent is quite unwarranted. the independence does not, of course, mean that the central bank is free to conduct any monetary policy they wish ; it only means that it should be able to use the means at its disposal to meet the objectives set by the political system without outside intervention. this is usually expressed as the central bank being instrument independent but not goal independent. the delegation of powers should be regarded as a means for politicians to ensure that the long - term aim of the monetary policy that they endeavour to achieve – but have difficulty guaranteeing – can become a reality. furthermore, a natural consequence of the independence is that the central bank shall be accountable for its actions and that monetary policy shall be conducted in a transparent manner. 7 it is interesting to note that, despite fairly substantial initial doubts, people have afterwards been very satisfied with the reforms implemented. monetary policy therefore appears to have essentially delivered