) monetary policy report 3 / 22 ». pindyck, r. s. ( 1991 ) « irreversibility, uncertainty, and investment ». journal of economic literature, sims, c. a. ( 2003 ). « implications of rational inattention ». journal of monetary economics, 50 ( 3 ). finansdepartementet ( 2018 ) « ny forskrift for pengepolitikken ». meld. nr. 8 ( 2017 - 18 ). woodford, m. ( 2003 ). « interest and prices ». princeton university press. footnotes [ 1 ] fischer and modigliani ( 1978 ) show that in periods of high and variable inflation the level of investment falls and investments shift towards projects with a shorter horizon. huizanga shows theoretically that this channel is due to greater uncertainty about the real value of new investments. [ 2 ] see woodford ( 2003 ). [ 3 ] high and variable inflation also has unintended effects on wealth distribution. the real value of existing debt is reduced at the same time as the value of savings declines. [ 4 ] in 2018, the government adopted a new monetary policy mandate. the main change was a reduction in the inflation target from 2. 5 percent to 2 percent. the government referred to the other changes as specifications and modernisations “ to align the regulation with prevailing practice ” ( official norwegian report no. 8 ( 2017 - 2018 ) ). the previous regulation from 2001 stated : “ in general, the direct effects on consumer prices resulting from changes in interest rates, taxes, excise duties and extraordinary temporary disturbances shall not be taken into account. ” the formulation “ extraordinary temporary disturbances ” must be interpreted in its historical context. in inflation targeting ’ s early phase, exception clauses were normally included in the mandates to clarify that monetary policy should not contribute to unnecessary fluctuations in the real economy. after the change in 2018, the mandate reads : “ [ i ] nflation targeting shall be forward - looking and flexible ”. the specification “ forward - looking ” means that in its conduct of monetary policy norges bank shall disregard temporary disturbances that do not affect inflation further out and that an exception clause for extraordinary temporary disturbances was, in the government ’ s view, no longer necessary. [ 5 ] the question of whether monetary policy should disregard imported inflation is related to the choice of price index for inflation targeting. this topic is also discussed in the economics literature ( see literature review in section

timely progress be made in all three areas. the board ’ s preference is that this progress be made by industry participants, without the need for regulation. in the event that this did not occur, the board would need to consider what steps it might take to promote the public interest. thank you for listening and i am happy to answer questions. 1 auspaynet stands for australian payments network. prior to mid 2017 it was the australian payments clearing association ( apca ). 2 in our most recent consumer payments survey, around 12 per cent of respondents used cash for all of their in - person transactions during the survey week, and cash was used more intensively by older australians and those in rural and regional areas. see doyle m - a, c fisher, e tellez and a yadav ( 2017 ), ‘ how australians pay : 10 / 11 bis central bankers'speeches evidence from the 2016 consumer payments survey ’, rba research discussion paper no 2017 – 04. 3 so - called initial coin offerings – crowdfunding - type ventures, typically blockchain - enabled, that allow participants to contribute digital currencies or other funds in return for digital tokens that may provide certain future rights or benefits – appear to be contributing to some of this speculative mania. 4 the concept of electronic cash is actually not new. areport from the bank for international settlements from over 20 years ago noted that e - money innovations ‘ have the potential to challenge the predominant role of cash for making small - value payments and could make retail transactions easier and cheaper for consumers and merchants ’ ( bank for international settlements ( 1996 ), ‘ implications for central banks of the development of electronic money ’, october ). a tokenised eaud could also be seen as an updated version of the 1990s technologies that yielded prototypes such as digicash and mondex. these were ultimately not commercially successful, but they demonstrated that versions of electronic cash were feasible. 5 of course, it might also be possible to pay / charge interest on electronic banknotes as well. this would raise some of the same issues discussed here. 6 these were noted in the bank ’ s payments system board updates following the august 2017 and november 2017 meetings. 11 / 11 bis central bankers'speeches