Jarle Bergo: Cyclical developments and monetary policy Speech by Mr Jarle Bergo, Deputy Governor of Norges Bank (Central Bank of Norway), at Regional network, Region East, Oslo, 10 November 2004. The text below may differ slightly from the actual presentation. The address is based on the assessments presented at Norges Bank’s press conference following the Executive Board’s monetary policy meeting on 3 November, Inflation Report 3/04 and on previous speeches. The references and the  Charts in pdf-format can also be found on the website of the Norges Bank. * * * Price stability, in the sense of low and stable inflation, is the objective of monetary policy in a number of countries. Historically, the experience of Norway and other countries is that high inflation has resulted in unstable output and employment. In addition, a fall in the price level will often occur in tandem with a downturn. The first inflation target was introduced in New Zealand in 1990. Canada followed in 1991, the UK in 1992, and Sweden and Australia in 1993. A number of other countries have followed suit. In Norway, the Government issued a regulation introducing an inflation target in 2001. Monetary policy in euro area countries and Switzerland is also aimed at price stability, even though this is not referred to as inflation targeting in these countries. Inflation targeting has proved to be particularly appropriate in very open, small and medium-sized economies.
They know we sit on a large amount of the gold and dollar reserves of the world. But what they think is really cool is the Fed Challenge, and how they can win a place in the national competition. My wife said to me this morning that the Fed Challenge sounds considerably more fun and exciting than the real thing. I applaud all of you who contribute to this effort. And I thank the NAF for its tribute to the New York Fed. 2/2