The entire Executive Board and most of the members of the Monetary Policy Department take part in this meeting. In addition, a number of advisers to the Executive Board and employees of the Financial Stability Department usually take part. A summary of the new information and the current status of the economy in Sweden and abroad is presented at the meeting. We also run through the alternative scenarios ordered at the risk meeting a few weeks earlier and discuss whether they really capture the risks that we Executive Board members envisage. We also have the opportunity at this meeting to request more information on various issues considered important to the coming decision. The meeting usually takes around three hours. Monetary Policy Department establishes its forecasts At approximately the same time as the meeting with the Executive Board, the Monetary Policy Department establishes its view of macroeconomic developments over the coming three years. In a preliminary stage it focuses on around ten key variables such as inflation, interest rates, GDP, number of hours worked, exchange rates and resource utilisation. The forecasts are produced on the basis of the exogenous conditions, the international forecasts, the model forecasts for the Swedish economy conditional on the current situation and assessments. The forecast for the interest rate path produced by the Monetary Policy Department is meant to reflect the Executive Board’s normal, historical behaviour. It is not  6  BIS Review 77/2008  any form of recommendation from the Department.
Irma Rosenberg: The monetary policy decision-making process Speech by Ms Irma Rosenberg, First Deputy Governor of the Sveriges Riksbank, at Riksbanken, Stockholm, 13 June 2008. *  *  *  The Riksbank is considered to be one of the most open central banks in the world. 1 Openness has also been one of the basic principles in shaping our activities. If an independent central bank is to be perceived as credible it must be possible for outsiders to understand its decisions and to assess its activities. We have therefore tried to be as open and clear as possible about what we do and why we do it. This increases the credibility of our monetary policy and makes it easier to anchor inflation expectations around the target. Part of this openness entails clearly describing how our analyses are achieved and the processes for making interest rate decisions. I believe that most people are familiar with the way we conduct monetary policy in general. We look ahead and base our monetary policy on forecasts. We have held many speeches on this subject. But how do we go about producing a forecast that leads to a decision on the interest rate? This is probably not as well-known and I intend to talk about it today. In recent years we have changed our methods of working in a number of fields. For example, since the beginning of 2007 we report very clearly the future interest rate path we expect to see.