Financial imbalances have built up, owing to a persistent rise in household debt ratios and high property price inflation over a long period.

Over time, lower house price inflation will curb household debt accumulation and thereby help to reduce the vulnerability of the household sector. Enterprises have ample access to credit and bank losses are low and profitability is solid.

"The housing market correction has lowered the risk of an abrupt and more pronounced decline further out. At the same time, growth in household debt remains high. Following an overall assessment, Norges Bank has advised keeping the level of the countercyclical capital buffer unchanged", says Governor Øystein Olsen.

In line with Norges Bank's advice, the Ministry of Finance decided today to keep the buffer rate unchanged at 2 percent.

• Ministry of Finance press release
• Norges Bank's advice is issued in the letter: Advice on the countercyclical capital buffer 2018 Q1
• The decision basis for Norges Bank's advice is presented in Section 5 of the March 2018 Monetary Policy Report