Chart 7. A tend-ency for the krone to weaken will be met by a widening of the interest-rate differential, and vice versa. Interventions in the foreign-exchange market are used to dampen fluctuations in the krone rate.
In the same vain and to the extent that they represent a substantial factor for the smooth functioning of markets, credit rating agencies will be required to meet specific standards. The philosophy of auto-regulation and “markets know best” as they care for the interests of the economy and of themselves has been wiped out by the ongoing traumatic experience.