The Eurosystem is responsible for the single monetary policy of the euro area. The main objective of monetary policy is to keep prices stable in the euro area, so that the value of money is held more or less unchanged and strong purchasing power is preserved. Monetary policy decisions are guided by the monetary policy strategy of the European Central Bank (ECB). The ECB published a new monetary policy strategy in 2021.
The Bank of Finland contributes to maintaining financial stability in Finland. It assesses risks to the financial system, compiles financial statistics and prepares macroprudential policy. In 2021, the Bank of Finland promoted domestic financial stability particularly via measures that curb excessive indebtedness. The financial sector's role in the mitigation of climate change became increasingly important.
The Bank of Finland is responsible for the availability and issuance of euro cash in Finland. In addition to cash supply, the Bank of Finland's duties include oversight, i.e. the assessment of the reliability and efficiency of domestic payment and securities settlement systems. In 2021, the COVID-19 pandemic further strengthened the decline in the use of cash and the transition in payment habits.
Holding and managing foreign reserves are among the statutory tasks of the Bank of Finland. The Bank of Finland’s asset performance was favourable in 2021. Investments in equity and real estate saw especially good returns. It was, however, a challenging year for fixed-income investments. In 2021, sustainability became the fourth objective of investment activities, alongside security, liquidity and return. The aim is for a carbon-neutral investment portfolio.
The Bank of Finland’s influence is based on expertise and research. The Bank participates in social debate and promotes financial literacy in Finland. In 2021, the Bank of Finland Museum expanded its activities to include a Financial Literacy Centre.
A central bank’s sustainability starts with its core functions. Our mission is rooted in the building of sustainable economic stability, thereby fostering the wellbeing of the general public.