The reason is that the inflation target, which is governed by regulation in pursuance of other provisions of the Act, provides the central bank with a suitable mandate. The central bank is no longer a limited liability company as it was until 1985, but a separate legal entity owned by the state. The central bank shall submit matters of special importance to the Ministry of Finance before making a decision. Although this submission arrangement gives the Ministry of Finance an opportunity to state its views, and obliges Norges Bank to consider them, it does not relieve Norges Bank of the full responsibility for its decisions. The text of the Act does not specify which matters are not only important, but of special importance. The preparatory works of the Act provide little guidance today. When the Act was under preparation, the interest rate was not a policy instrument, but had the nature of being an end in itself. It was rarely changed, and then only in critical situations for the Norwegian economy. In the period of exchange rate management in the 1990s, changes in the key rate were also linked to large currency inflows or outflows that might indicate substantial imbalances in our economy. In the past 10–12 years this has changed completely. Norges Bank operates a target set by the government authorities, and interest rate changes are nearly always small and rarely come as a surprise to economic agents.
Joseph Yam: A new euro clearing system for Hong Kong Remarks by Mr Joseph Yam, Chief Executive of the Hong Kong Monetary Authority, at the signing ceremony for the appointment of Standard Chartered Bank as settlement institution for the euro clearing system in Hong Kong, Hong Kong, 3 July 2002. *  *  *  We live in a financial world where boundaries and barriers are progressively collapsing, whether as the result of conscious policy decisions in favour of liberalisation or because of the new vistas opened up by the onward march of information technology. Thus, restrictions on providing or using services across geographic or political borders are on the decline. Particular transactional services, such as quoting, dealing, confirming, settling, delivering, paying and safe-keeping, are increasingly footloose, in the sense that many of them can be readily accessed from remote locations. Moreover, the development of interfaces between systems in different parts of the world provides scope for continuous 24-hour real-time trading. At the same time, the regulatory framework is tending towards standardisation around the world, thereby reducing the potential for regulatory arbitrage between jurisdictions. As a result of these various developments, the marketplace in which we can operate is potentially ever larger, but at the same time the potential number of competitors is ever growing. Against this background, financial centres must be nimble, competitive, efficient and safe, and alert to the changing world, if they are to thrive. One of the essentials is that they must offer an effective and robust financial infrastructure.