this year, the international oil price continued what seemed to be an inexorable ascent. this was driven to a large degree by the successful implementation of the agreement to restrict output by the organization of petroleum exporting countries ( opec ) and some nonopec countries. the result was a steady increase in the price of brent crude oil, from us $ 50 per barrel in july last year to around us $ 80 by june this year. although some moderation has been evident recently, the outlook remains uncertain, with mixed views by analysts in this regard. to date, the impact on domestic petrol prices and on inflation has been significant. the second development was a marked escalation in the changes to us trade policy. initially, tariff increases were focused primarily on china, but have subsequently been broadened to encompass some traditional allies of the us as well. it is still unclear whether these actions and countervailing reactions will evolve into a full - blown trade war. however, the rise in protectionism has already had a moderating impact on the optimism for global growth, and has also already contributed to risk - off scenarios in global financial markets. of concern is that the sharp contraction in world trade that was recorded in april would be protracted. this was the worst performance in world trade since may 2015. page - 2 - of 9 the net result of all of these recent global developments has been a generally deteriorating environment for emerging markets. during the second half of last year, the domestic economic outlook was overshadowed by heightened political uncertainty in the lead - up to the african national congress ( anc ) elective conference. business and consumer confidence were at extremely low levels. although the 1. 3 % growth rate for the year exceeded the post - crisis low of 0. 6 % recorded in 2016, it was in stark contrast to the average emerging market growth rate of 4. 7 %. the low growth and deteriorating fiscal position exacerbated the risk of rating agencies ’ downgrades that could have seen south african bonds falling out of some of the major global bond indices. in response to these developments and risks, the rand remained under pressure for much of that period and reached its weakest level of r14. 47 against the us dollar during november. renewed optimism following the outcome of the anc ’ s elective conference set in during the early part of 2018. consumer confidence reached a record high in the first quarter of the year and remained high, although slightly lower in the second quarter.

monetary policy and macroprudential policy ”, published on 25 january 2013. bis central bankers ’ speeches in principle, macroprudential policy tools can reduce the risks linked to household indebtedness in two different ways. first, one can increase the resilience of the financial system through, for instance, higher capital levels in the banks. it reduces the risk of a macroeconomic shock, for instance, a sharp fall in swedish housing prices, developing into a banking crisis if the banks have more capital to absorb loan losses. second, one can try to directly slow down growth in household indebtedness through, for instance, different types of limits to how much household are allowed to borrow. however, sweden has long lacked a framework for macroprudential policy, with clear guidelines as to which authority should take action and what tools they should use. i and several of my colleagues have called for such a framework on many occasions. now we have this framework in place. i now intend to describe the framework, the measures that have been taken and what remains to be done. the allocation of responsibility for the tools and the establishment of a financial stability council the government announced last autumn that finansinspektionen would have the main responsibility for decisions on macroprudential policy measures and that a financial stability council would be established. the riksbank ’ s mandate remains unchanged. we shall continue to safeguard financial stability. we shall therefore continue to analyse and oversee the financial system, to inform and warn of risks and to make recommendations regarding measures to take. as i mentioned earlier, financial stability is also an important condition for monetary policy to function. the new framework also entailed establishing a forum for representatives of the government, finansinspektionen, the swedish national debt office and the riksbank to meet and discuss questions of financial stability, what is known as the financial stability council. the council meets regularly, normally twice a year, and the information provided and discussions held at these meetings are publicised in the form of minutes no later than two weeks after the meetings. the meetings give us the possibility to discuss how the policy areas interact and what types of measure are needed to avoid new financial crises as far as possible. the authorities represented on the council then make decisions independently within their fields of responsibility, as to which measures should be taken. figure 12 illustrates the new framework for macroprudential policy in sweden. this spring ’ s work in the