The Norwegian central bank defended its policy framework and stressed the need for flexibility on January 31, as it published its response to a government review of monetary policy.

The horizon for monetary policy has lengthened since the inflation target was introduced in 2001, reflecting greater trade-offs and larger shocks, the central bank says in the document.

Faced with "pronounced international cyclical fluctuations", declining rates abroad and strong inward migration, Norges Bank says it