The krone has been stable, and it is the longest period without interventions in the currency market since adopting the fixed exchange rate regime in 1982. The ECB continues to normalise its monetary policy and expects to end net purchases of bonds after December 2018. In recent years, Danish households have shifted to loans with lower interest rate risk and loans with amortisation. This makes their disposable income less sensitive to interest rate changes.

Danmarks Nationalbank oversees payment and settlement systems in Denmark in order to promote a safe and efficient financial infrastructure. Danmarks Nationalbank has performed an assessment of whether the Danish retail payment systems observe international standards for payment systems. The assessment shows that the systems extensively observe the security and efficiency requirements. Nevertheless, Danmarks Nationalbank recommends improvements in a number of areas.

This report presents the conclusions of Danmarks Nationalbank's oversight in 2017 of the core payment and settlement systems in Denmark and the most important payment solutions. The core systems and solutions extensively comply with international standards for efficiency and security, though there is still room for improvement. Cyber risks and risks arising from interdependencies remain a focus of Danmarks Nationalbank's oversight. Not all systems have made the same headway in the work regarding cyber security. This work is also carried out at sector level.

The Danish krone has been stable, on the strong side of the central rate vis-à-vis the euro. Danmarks Nationalbank has not intervened in the foreign exchange market in the past eleven months up to the end of February. Government bond yields in Denmark increased towards the end of 2017 and at the beginning of 2018. Companies and households increased their borrowing at a stable, but subdued, rate.

Danmarks Nationalbank's accounts for 2017 show a loss of kr. 254 million, compared with a profit of kr. 3,928 million in 2016. Much of the loss is attributable to the fact that a large part of the foreign exchange reserve earns negative interest.

Denmark's central government debt was 21 per cent of GDP at the end of 2017. This is a decrease from 2016, attributable to a government budget surplus. In 2017, on average, the central government issued bonds at a yield to maturity of 0.2 per cent and a maturity of 7.5 years. Interest costs for the central government debt totalled 0.8 per cent of GDP. The yield spread to Germany narrowed, and liquidity improved further in the market for Danish government bonds in 2017, where the central government introduced a new primary dealer model.