rate for companies average mortgage rate repo rate note. per cent, monthly averages. average mortgage rates for households and bank interest rates for companies on new agreements, and the repo rate sources : statistics sweden and the riksbank bis central bankers ’ speeches figure 11. inflation expectations of money market agents annual percentage change inflation expectations cpi - 2 - 2 sources : statistics sweden and tns sifo prospera figure 12. household debt ratio percentage of disposable income ireland spain usa sweden sources : eurostat, national central banks and the riksbank bis central bankers ’ speeches figure 13. household assets and debts in sweden percentage of disposable income total wealth real wealth liquid wealth debts 71 73 75 77 79 81 83 85 87 89 91 93 95 97 99 01 03 05 07 09 11 note. there is no regular publication of official data for total household wealth and its components. the series are based on the riksbank ’ s estimate of the households ’ financial and real wealth. real wealth is the households ’ wealth in housing. liquid wealth mainly consists of household assets in cash, bank deposits, bonds and shares. sources : statistics sweden and the riksbank figure 14. unemployment percentage of labour force, 15 – 74 age group, seasonally adjusted data average 1980 - 1991 average 1999 - 2012 q3 outcome source : statistics sweden bis central bankers ’ speeches figure 15. number of unemployed in vulnerable groups and total of other registered unemployed total number of unemployed individuals registered with employment office 250 000 250 000 vulnerable groups other groups 200 000 200 000 150 000 150 000 100 000 100 000 50 000 50 000 note. trend - adjusted values. number of remaining job - seekers at end of month. source : employment office figure 16. unemployment and the development of the housing market unemployed as a percentage of the labour force, index 2007 = 100. the figures in brackets present the fall in real housing prices from the peak to the trough. ireland ( - 40. 5 per cent ) spain ( - 22. 5 per cent ) usa ( - 22. 7 per cent ) sweden ( - 0. 0 per cent ) source : the oecd bis central bankers ’ speeches figure 17. inflation in sweden annual percentage change the cpif is the cpi with a fixed mortgage rate. cpif cpi - 1 - 1 - 2 - 2 note. the cpif is the cpi with a fixed mortgage rate. sources : statistics sweden and the riksbank figure 18. repo rate per cent, quarterly

very low ( see figure 1 ). let me now go back a little and describe how we ended up in the position we are now in with regard to monetary policy. i also intend to take up some of the important lessons learned from the international financial and debt crisis of recent years. the financial crisis became a debt crisis in europe … the global financial crisis began about four years ago. the origins of the crisis lay in problems on the us housing market, but after the bankruptcy of lehman brothers in september 2008 the situation developed into a global financial crisis. gdp in the world as a whole fell for the first time since the 1940s ( see figure 2 ). there was also a dramatic fall in global trade ( see figure 3 ). this was then followed by a couple of years in which the global economy began to recover, and global trade increased ( see figure 3 ). however, it did not take long for clouds to gather on the horizon again. problems with major budget deficits and sovereign debts became apparent in several countries in the euro area, bis central bankers ’ speeches primarily in greece, but also in ireland, italy, spain and portugal ( see figure 4 ). in europe, the financial crisis was followed by a debt crisis. however, the reasons why the various countries were hit by problems were not always the same. in greece, for example, public finances were far too weak at the outset to cope with such a severe downturn as that brought about by the financial crisis. but countries like ireland and spain also suffered serious problems, despite their relatively strong public finances at the outset. how could this happen? the problems on the us housing market originally triggered the global financial crisis. but problems also arose on the housing markets in several other countries, such as spain and ireland ( see figure 5 ). public finances were hit hard when the banking sector had to be rescued in the wake of a bursting housing bubble, in which housing prices and bank lending had chased each other ’ s tails to form an unsustainable spiral. this was why these countries quickly encountered major problems in managing the growth of their sovereign debts, despite their relatively good position at the outset. an excessive build - up of debt – irrespective of whether it takes place in the private or the public sector – leads to problems sooner or later. events in the euro area in recent years provide a frightening illustration of this. it is clear that the euro area is facing major challenges, not only for individual countries but for the