ECONOMIC PERSPECTIVES Address by Governor Øystein Olsen to the Supervisory Council of Norges Bank and invited guests on Thursday 14 February 2019  Analyses and charts are based on information up to and including 12 February 2019. THURSDAY 14 FEBRUARY 2019  Economic perspectives 2019  NORGES BANK ECONOMIC PERSPECTIVES 14 FEBRUARY 2019  Good morning, Kristoffer! It is now 6:00 am on Friday, 15 February 2030. The temperature is 7 degrees and it’s raining. You have been through four sleep cycles and can get up without violating the terms and conditions of your health insurance. The health module recommends cereal with oat milk for breakfast. I have bought oat milk, which was delivered at 4:00 am. News of relevance to you: The new government quarter opens today – your space is finally ready. Your investments in Green Equities have risen by 20 percent, on news of the major trade and environmental technology agreement concluded between the United States and China. The trading platform Nett sustained a hacker attack last night. Customer data were stolen, and customers are leaving the platform. I managed to withdraw 8 000 of the 67 000 kroner you had uploaded to the platform before all accounts were frozen. The rest of your money may be lost. In yesterday’s Annual Address, the Governor of Norges Bank announced that the next generation of central bank digital currency will be managed by artificial intelligence for a trial period. Have a nice day.
Source: Norges Bank  If necessary, Norges Bank can supply liquidity to the payment system. Norges Bank is the bankers’ bank. 13  In addition, Norges Bank has a special responsibility for the payment system. The Bank oversees and supervises various components of the payment system and should drive new and efficient solutions. NORGES BANK ECONOMIC PERSPECTIVES 14 FEBRUARY 2019  Today, nearly all payments from customers’ bank accounts are made using deposit money.7 This is money created by banks. When people borrow money from a bank, the bank credits the same amount to an account. The money deposited was created at the instant the loan was made. Deposit money circulates through the banking system, in and out of people’s accounts and is only to a limited extent converted to cash. As long as we have confidence in both the value of the Norwegian krone and in the banking system, we will also have confidence in deposit money. The cash provided by Norges Bank has important attributes. While deposit money is a claim on a private bank, cash is a claim on the central bank. Cash is a safe alternative if private payment solutions are not functioning or do not meet the expectations of the public in terms of security and efficiency. Even though the use of cash has declined, cash is still in use and has important contingency functions. But new digital alternatives are emerging.