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

9 per cent. as recently as december 2021, inflation excluding energy prices was 1. 7 per cent, which was a decline of 0. 2 percentage points compared with the outcome in november 2021. the first signs in actual price developments that inflation excluding energy prices was on the way up came in the january outcome, which was 2, 5 per 1 with a policy rate maintained at zero per cent in 2022. and only a few expected modest increases in 2023. today, inflation is 9. 3 per cent and the riksbank, like other central banks around the world, has raised the policy rate in rather large steps. this is as good an illustration as any of how quickly and unexpectedly things have happened or, to refer to my initial quotation, that decades have happened within a few weeks. a natural conclusion is that this development was genuinely difficult to predict. there are, of course, things that we could have predicted better, such as the boost to inflation that came from the rapid recovery after the pandemic. however, it would also have been necessary to foresee, for example, that russia would invade ukraine in february 2022, that russia would throttle its exports of natural gas to europe and that this would bring electricity prices up to exceptionally high levels. two opposing types of criticism of monetary policy there will always be those who claim, after the event, that things should have been anticipated – and not rarely that they themselves actually did so. one argument in the swedish debate is that today ’ s high inflation is an obvious result of the expansionary policy previously pursued by the riksbank and many other central banks, during the rather long period when the problem was the reverse ; that is, it was difficult to bring inflation up to the target level. it is certainly reasonable to assume that inflationary impulses from, for example, rising energy prices will more easily take hold if demand in the economy has been kept up by an expansionary policy than if it has not. but i find it difficult to push the argument further than that. apart from the fact that there are already convincing explanations for the high inflation, it would require that a monetary policy that has had difficulty for years in bringing inflation up to the target would suddenly result in some kind of all - at - once effect, making inflation instead severely overshoot the target. even though monetary policy works with long and variable lags, this would be an extreme example, with a very odd monetary policy transmission mechanism. 4 in the