crisis. we have come sa long way, but there are still challenges ahead of us for the ten years to come. yet the challenges for the financial industry are gradually changing in nature : they could shift from adapting to the regulatory or monetary policy environment to reflecting on new business model strategies. in this regard, the expected strengthening of the economic recovery will hopefully make the path smoother. austerity – or rigour – will remain necessary, but innovation will be the game changer. thank you for your attention. 4 / 9 bis central bankers'speeches slide 2 5 / 9 bis central bankers'speeches slide 3 6 / 9 bis central bankers'speeches slide 4 7 / 9 bis central bankers'speeches slide 5 8 / 9 bis central bankers'speeches slide 6 9 / 9 bis central bankers'speeches

øystein olsen : the conduct of monetary policy introductory statement by mr øystein olsen, governor of norges bank ( central bank of norway ), at the hearing before the standing committee on finance and economic affairs of the storting ( norwegian parliament ), oslo, 14 may 2018. * * * accompanying slides thank you for this opportunity to report on the conduct of monetary policy. my introduction here today is based on norges bank ’ s annual report for 2017 and our monetary policy assessments up to the monetary policy meeting at the beginning of may. the various components of economic policy must interact to achieve sound and stable economic developments over time – with high employment and low unemployment. the primary objective of monetary policy is to maintain monetary stability. since 2001, the operational target of monetary policy has been low and stable inflation. this has been retained in the new regulation on monetary policy issued by the government on 2 march this year. the regulation clarifies the monetary policy mandate and will not result in significant changes in the conduct of monetary policy. i will return to this topic later, but first of all i would like to go back to just over a year ago. at the beginning of 2017, the level of spare capacity in the norwegian economy was still fairly high and there were prospects that inflation could remain below the inflation target in the coming years. international interest rates were very low. norges bank had kept the key policy rate at 0. 5 percent for a year, and there was a slightly higher probability that the key policy rate would be reduced further than that it would be increased in the near term. there were signs of some brightening, both internationally and in norway, but considerable uncertainty prevailed. chart : global gdp growth the economic outlook changed through 2017. global growth gradually gained a firm footing, and global growth projections were revised up. for several of norway ’ s main trading partners, unemployment was lower towards the end of 2017 than before the financial crisis. despite rising growth abroad and falling unemployment, wage growth remained moderate. in 2017, most of norway ’ s trading partners were still experiencing below - target core inflation. chart : international interest rates policy rates in the us, uk and canada were raised in 2017. in addition, the federal reserve started to cautiously reduce its balance sheet, while the european central bank ( ecb ) announced that it would reduce its asset purchases from 2018. nevertheless, international interest rates remain low, and signals from central banks as well as market expectations indicate a very gradual rise