##ges bank operates a flexible inflation targeting regime, so that weight is given to both variability in inflation and variability in output and employment. with confidence in the inflation target among economic agents, monetary policy in norway has been able to contribute to stabilising the business cycle. lower income from oil exports following the fall in the oil price meant cost - competitiveness needed to improve. a floating exchange rate greatly facilitated this process. in the aftermath of the oil price fall, the krone exchange rate tracked the oil price and wage settlements remained moderate. with inflation expectations well anchored, the bank ’ s target rate could be reduced, thus underpinning a weaker krone. as a result, relative labour costs declined markedly, strengthening the position of norwegian firms exposed to international competition. over time this could enable new exports to emerge as the production of oil and gas dwindles. over the past few quarters, growth has picked up, the labour market has improved and 1 / 2 bis central bankers'speeches unemployment has fallen. the policy mix has played an important role, helped by a recovery of the oil price. competitiveness in the oil service industry has also improved considerably, particularly after the substantial cost - cutting measures introduced by companies in this industry in recent years. with a floating exchange rate, domestic interest rates can differ from external interest rates, but an interest rate differential that becomes too wide can have a substantial effect on the exchange rate, generating instability in inflation, output and employment. thus, the domestic interest rate will also be influenced by external rates to a large extent under an inflation - targeting regime. this was illustrated by a positive, but limited, interest rate differential in the first years following the global financial crisis, when the effect on norway ’ s economy was less severe than for most other european economies. this allowed monetary policy to respond to the economic downturn that followed in the aftermath of the fall in oil prices. the key policy rate was lowered and has been kept at 0. 5 percent since march 2016. our experience has shown us the crucial importance of flexibility in inflation targeting in enabling us to make the appropriate trade - offs in response to shocks to the economy. the time horizon for achieving the target must be sufficiently long, and the balance of risks, including risks related to financial stability, must be taken into account. the past couple of years have been demanding for the norwegian economy, and the transition towards being less oil - dependent is ongoing. new sectors must grow to offset the downturn in petroleum -

tarisa watanagase : financial globalization and market turbulence opening remarks by dr tarisa watanagase, governor of the bank of thailand, at the bank of thailand ’ s international symposium on “ financial globalization and emerging market economies ”, bangkok, 7 november 2008. * * * professors, distinguished participants, fellow central bankers, ladies and gentlemen, it is a great pleasure for me to welcome you to the bot international symposium 2008 on “ financial globalization and emerging market economies ”. this symposium is the third in a series of international symposia organized by the bank of thailand. from its first meeting eight years ago, this symposium series has been a gathering of prominent academics, policy - makers and market participants to discuss current issues on both monetary and macroeconomic policies from an international perspective of either emerging, regional, or global economies. over the past several years, a common theme for us as the organizer has been the focus on inflation targeting and its implications on monetary and financial sector policies where appropriate. through this series of symposia, a body of knowledge has been timely accumulated to be put to great tests from the increasing trend in financial globalization and the accompanying turbulence in recent years. when the topic for this year ’ s symposium was chosen prior to this current market turmoil, it was not apparent at the time that the turbulence would indeed turn out to be one of the most challenging events since the great depression. so this is an extraordinary time for the world financial market and probably most suitable for an international symposium on the subject of financial globalization. ladies and gentlemen, financial globalization has certainly made the international financial landscape look very different today compared to just a decade ago. and almost every day, new events continue to re - shape it even further. one aspect among these changes, however, remains constant. that is, despite the complexity and sophistication of today's financial institutions as well as instruments that are developed to manage all kinds of risks, the remarkable degree of global financial linkage still makes financial turmoil transmit from one country to another at an ever faster pace than we have previously anticipated. like all financial crises of the recent past, several weaknesses and excesses were initially submerged and only later found to be much larger than the initial estimates, contributing to the permanent boom - bust cycle that seems to always accompany modern business and finance. understanding the various causes of the crises is only the initial step towards resolving its short - term impacts and preventing its recurrence, if entirely possible, in