with a final report due in october, and the bank of england supports the efforts to set a baseline set of expectations. these include that stablecoins should be regulated based on the functions they perform and risks they create, and that there should be comprehensive domestic and international regulation and supervision. global stablecoins should have robust governance and risk management, and be transparent about their stability mechanisms and coin - holders ’ rights. this baseline set of expectations will help avoid regulatory fragmentation and is an important and necessary step. but alone it is not sufficient. existing standards must be examined and updated where necessary. there needs to be a clear g20 mandate for the various sectoral standard - setting bodies to consider their standards and whether they need to be refreshed or clarified in light of stablecoins. this is necessary to truly deliver on the principle of same risk - same regulation. the committee on payments and market infrastructure ( cpmi ) and international organization of securities commissions ( iosco ) are working to ensure that it is clear to stablecoin developers how international standards of regulation and supervision for financial market infrastructures, including payment systems, ( the principles for financial market infrastructures – pfmi ) will apply to them, including where stablecoins are used in systemic payment systems. other standards setters, such as the financial action task force ( fatf ) and the basel committee on banking supervision ( bcbs ), will need to respond as well. coordination between regulators is essential too. in particular, host regulators of global stablecoins must, and are, working with other regulators in other jurisdictions to ensure that they are appropriately regulated and gaps in coverage, opportunities for regulatory arbitrage, do not emerge. the bank looks forward to the conclusions of the fsb ’ s consultation, and the subsequent finalising of international work, to ensure a comprehensive framework can be in place. current proposed global stablecoin offerings will need to demonstrate how they meet these key domestic and international standards. they must do so before the global regulatory community can be comfortable with their launch and widespread adoption. central bank digital currency a very reasonable and important question is whether a better outcome would be for central banks themselves to harness much of the technological and it systems innovation and directly digitise cash? a central bank digital currency ( cbdc ) would be an electronic form of central bank money that could be used all speeches are available online at www. bankofengland. co. uk / news / speeches and @ boe _

those prices are less susceptible to the influence of monetary policy, and will soon be contributing around one percentage point to measured inflation. so prices set in the market sector of the economy will need to rise by only about 1 % a year if inflation is to meet the 2 % target. that is a tall order. but the monetary policy committee can respond flexibly by looking through the effects of administered prices as long as market - generated inflation pressures remain subdued. there are good reasons to suppose that a gentle recovery is underway. broad money growth, adjusted for transactions between financial intermediaries, is now rising at around 4½ % a year, a rate that should, if maintained, show up in a recovery during 2013. credit conditions have improved, and should improve further as the impact of the funding for lending scheme kicks in. mortgage rates have fallen, especially for high loan to value mortgages. big companies have large holdings of cash and ready access to capital markets. equity prices are nearly 10 % higher than last january. if the policy prescriptions i mentioned earlier were adopted, then confidence that we were moving in the right direction should translate into higher business and housing investment, and underpin the recovery. recent actions by central banks and governments in a number of industrialised countries have raised questions about the frameworks within which monetary policy is being conducted. in the uk, the inflation target was introduced almost 21 years ago, and it has now come of age. it would be sensible to review the arrangements for setting monetary policy. bis central bankers ’ speeches last october i reviewed the first two decades of experience with the inflation target. in that speech, i argued that there were times when a concern for financial stability might justify deviating from the inflation target, but that policies aimed directly at preventing too rapid an expansion of financial balance sheets, of the kind now available to the bank ’ s financial policy committee, might be a less costly way, in terms of lost output and employment, of achieving overall stability. and i also argued that price stability in the long run remained essential for economic success. that is why price stability is the central plank of the remit given to the mpc by the chancellor. the other part of the remit makes clear that we are not expected to pursue 2 % inflation in the short run whatever the cost – it recognises that attempting to hit the inflation target at all times may cause “ undesirable volatility in output ”. the remit overall has become known as “