in shoring up banks'resilience. nor was it a surprise that our members committed to implementing the outstanding elements of basel iii fully and consistently, and as soon as possible. here i take the opportunity to reiterate the importance for all member jurisdictions of pressing ahead with this commitment to implement all aspects of basel iii. second, and with that premise established, i would argue that this need for global cooperation has only grown in importance over time. the great financial crisis ( gfc ) highlighted the deep and opaque cross - border interconnections existing within the global banking system. yet, while some of the channels of interconnectedness that fuelled the gfc have since subsided, we have also witnessed profound structural changes to the financial system over the past decade that raise fundamental financial stability questions. these include the rise of non - bank financial intermediation, and the deep pockets of opacity and interconnections with the banking system – as we have seen in cases such as archegos, evergrande, greensill and huarong. in addition, medium - term structural trends such as the ongoing digitalisation of finance and increasing climate - related financial risks are so cross - sectoral and global in nature that they can only be effectively addressed through greater cooperation across sectors and across jurisdictions. 2 / 3 bis - central bankers'speeches my third point is that cooperation can, and should, take different forms. while regulation – most notably the basel framework – is perhaps the most visible product of global cooperation, there are a number of other, equally important, dimensions. supervisory principles and guidelines, while often high - level in nature, are a powerful tool to help raise the bar when it comes to the quality and effectiveness of risk management practices and supervision, and to help provide a common global baseline. supervisory cooperation, including through the sharing of supervisory intelligence and best practices, is a vital channel for authorities to assist and learn from one another. indeed, merely having a continuous and ongoing channel of communication among authorities is perhaps one of the most important levers available to us. equally, cooperation should be multi - faceted in scope, and should encompass both microprudential and macroprudential financial stability dimensions. we learnt this lesson the hard way in the wake of the gfc, and that is why the committee's membership – comprising both central banks and supervisory authorities – is crucial to ensure that we benefit from both the system - wide and institution - specific perspectives. moreover

pablo hernandez de cos : central bank independence and policy coordination in a globalised world speech by mr pablo hernandez de cos, governor of the bank of spain, at the international symposium on central bank independence, panel on " central bank independence and policy coordination in a globalised world ", organised by sveriges riksbank, stockholm, 10 january 2023. * * * let me start by thanking the riksbank for organising this symposium and for inviting me to take part in this panel. in many ways, the theme of our panel – central bank independence and policy coordination in a globalised world – is a good description of the objectives to which stefan ingves'many, many, achievements have contributed during his long and varied career, including most notably as chair of the basel committee and as chair of the advisory technical committee of the european systemic risk board. it is therefore somewhat humbling for me to take part in this discussion as his successor as chair of both these committees. while i will focus my remarks on the financial stability aspects of independence, globalisation and coordination, allow me to start by recalling the main reason why the task of controlling inflation has been assigned to independent monetary authorities in a large number of economies. the argument is based on what the economic literature calls " time inconsistency ", which highlights the role of expectations in agents'behaviour. price stability unquestionably enhances economic growth and improves wellbeing in the long run. however, if the monetary authority is not independent and focuses on other more short - term goals, it may repeatedly use monetary policy to stimulate demand above the level that would be consistent with its inflation objective, in which case an inflationary bias will be generated. in the short run, higher levels of economic activity and employment could be attained, but costs would emerge later on. the inflationary bias would ultimately be anticipated and incorporated into agents'expectations and, therefore, into price - setting and wage bargaining. the outcome would be higher inflation without any lasting improvement in the economy's level of output and employment. this would detract from monetary policy efficiency and the commitment to price stability would no longer be credible. taking the long view that price stability requires is more difficult for political authorities, which naturally may be inclined to give priority to shorter - term considerations. in my view, the time - inconsistency argument for an independent monetary authority is also relevant – and thus, may also be applied – to the need for an