Lars Rohde: The history of the Danish fixed exchange rate regime

Speech by Mr Lars Rohde, Governor of the National Bank of Denmark, at the National Bank of Denmark's conference marking the 40th anniversary of the Danish fixed exchange rate regime, Copenhagen, 31 October 2022.

The views expressed in this speech are those of the speaker and not the view of the BIS.

*** Welcome ***

Ladies and gentlemen. It's a great pleasure for me to be here today. I am grateful for seeing so many familiar faces.

Today we mark the 40-year anniversary of the current Danish monetary policy regime. A regime where we keep the Danish krone stable to the euro. And before that, to the German Mark.

In 1982, I entered Danmarks Nationalbank for the first time as a young economist. The year that the new regime was introduced. And yes, I had curly dark hair back then.

In those days, many countries pursued a fixed exchange rate policy. That has changed. Today, the Danish monetary policy regime is one of the longest running fixed exchange rate regimes in the world. And it is somewhat unique.

Over the years, the regime has become a cornerstone of economic policy in Denmark. And it has contributed to a remarkable transformation of the Danish economy. A transformation from a fragile economy characterised by high inflation and substantial imbalances to the strong economy that we know today.