"In recent months, house price inflation has slowed, but household credit growth remains high. High property price inflation over a longer period and a persistent rise in household debt ratios suggest that financial imbalances have built up", says Governor Øystein Olsen.

Financial imbalances increase the risk of an abrupt decline in demand and bank loan losses. Low house price inflation and tighter bank lending will curb growth in household debt and could reduce household vulnerabilities further out.

In line with Norges Bank's advice, the Ministry of Finance decided today to keep the buffer rate unchanged at 2 percent at the end of 2017.

• Ministry of Finance press release
• Norges Bank's advice is issued in the letter: Advice on the countercyclical capital buffer 2017 Q2
• The decision basis for Norges Bank's advice is presented in Section 5 of the June 2017 Monetary Policy Report (2/17)