Uncertainty led to capital flight to countries with substantial gold reserves, such as the US. Countries with small reserves had to maintain a high interest rate to prevent substantial gold outflows. In September 1931, the UK decided to abandon the gold standard. Denmark, Sweden and Norway brought gold redemption to a halt in the same month. Norges Bank was put to a severe test in the interwar period. Nicolai Rygg’s lot was to resolve the problems left by the policy conducted during and just after the war. His approach was on a par with international practice at the time. 18 Although he had his critics, not all the criticism levelled against him would necessarily be regarded as equally well founded today. The general view of Rygg has become more balanced. 19 But the perception of Rygg and Norges Bank in the interwar years, that subsequently became ingrained, had an impact on the tasks that were later assigned to the central bank. The pendulum swung towards less independence for Norges Bank, since the Bank was held responsible for the recession. This impression prevailed for such a long time that it also came to influence the current Norges Bank Act.
In Norway, the Ministry of Finance performs an annual evaluation of the conduct of monetary policy in a separate report. Its assessment is partly based on a report by an independent expert group. The Governor of Norges Bank appears at a parliamentary hearing when the Standing Committee on Finance and Economic Affairs works on the report. The discussion concludes with a debate in the Storting. Advisory role With new and clearly defined economic policy tasks, Norges Bank stepped back somewhat as economic policy advisor. For example, the Bank has discontinued its annual assessment of fiscal policy in what was at the time labelled “budget letters”, and we rarely express our views on official reports regarding economic issues. Norges Bank is a consultative body for laws and regulations affecting the stability of the financial system. 43 Moreover, the Bank is obliged under the Act to inform the Ministry when in the opinion of the Bank, there is a need for measures related to monetary, credit or exchange rate policy to be taken by others than the Bank. 40  Helge Syrstad (2003): Sentralbankens uavhengighet [Central bank independence], Fagbokforlaget. 41  In a different context, professor Eivind Smith states another view that may be of importance: “It can be conceivably argued that independence [..] is possible only if the authority to appoint persons to the “independent” body is delegated to bodies other than those the appointees are supposed to be independent of.