30 / 09 / 2020 introductory panel statement | deutsche bundesbank introductory panel statement speech at the institute for monetary and financial stability “ ecb and its watchers xxi conference ” 30. 09. 2020 | frankfurt am main | jens weidmann 1 introduction 2 christian noyer 3 jordi gali 4 helmut siekmann 1 introduction chere christine, good morning ladies and gentlemen, i am delighted to moderate the ﬁrst debate today. dear volker, thank you very much for your invitation and for organising this conference as a hybrid event. in times like these, we are becoming more and more experienced in communicating virtually. nevertheless, there is always a lingering sense of uncertainty about whether the technical set - up will work properly. before our single monetary policy started, there may also have been doubts about whether the eurosystem could fulﬁl its mandate to maintain price stability. looking back now – on more than 21 years of monetary policy and also “ ecb watching ” – the eurosystem has delivered on the promise made to the people of europe to keep prices stable. this has been a truly remarkable success. one key element in this has been the clarity of the mandate itself. in late 1998, the ecb ’ s ﬁrst president, wim duisenberg, outlined the strategy for the single monetary policy in a speech. he started from his conviction that, by maintaining price stability, “ monetary policy makes the https : / / www. bundesbank. de / en / press / speeches / introductory - panel - statement - 846034 1 / 5 30 / 09 / 2020 introductory panel statement | deutsche bundesbank greatest possible contribution towards raising the standard of living of europe ’ s citizens and improving growth and employment prospects ”. [ 1 ] this fundamental tenet also inspired the european treaties, which enshrine price stability as our primary objective. so to answer the question raised in the title of our session : the mandate needs no modiﬁcation when viewed from this perspective. at any rate, the eurosystem takes its mandate as a given. and our actions will continue to be geared towards achieving our overriding objective of price stability. however, the treaties are silent on how to deﬁne or measure price stability. nor do they specify a reaction function for monetary policy or a hierarchy of instruments needed to ensure price stability. nor do they tell us how to communicate with the public. choices like these constitute the monetary policy strategy. given the profound changes

hermann remsperger : central banks and forecasting needs concluding remarks by dr hermann remsperger, member of the executive board of the deutsche bundesbank, at the eighth bundesbank spring conference “ new developments in economic forecasting ”, eltville, 6 may 2006. * * * at the end of this conference and after two days of intensive discussion, i am sure, dear colleagues, that you would like my concluding remarks to be brief. and that is why i want to raise only one specific question : are all central banks confronted with the same forecasting needs or are there differences – in particular, are there differences rooted in different strategies? i think, we can approach this question from two opposite angles. the first perspective takes a certain monetary policy concept as given and asks about the consequences on forecasting. the second perspective takes our forecasting abilities as given and asks about the consequences on the choice of a specific monetary policy strategy. let me start from this second perspective. i ’ d like to emphasize that the limits in forecasting do have an influence on the design and implementation of monetary policy. take the ecb as a first example. the two - pillar strategy of the eurosystem was designed and built in 1998 with the expectation of a profound regime shift : the move to stage three of european monetary union was expected to affect economic behaviour, institutional structures and statistical series in the euro area. in its first monthly report in january 1999 the ecb made the following statement : “ the eurosystem ’ s stability - oriented monetary policy strategy is a new and distinct strategy, which reflects the unique circumstances and institutional environment that will face the eurosystem. … in particular, mechanical responses to a small number of indicators or forecasts at the start of stage three may be especially misguided, given the inevitable uncertainties about economic relationships prompted by the regime shift associated with the transition to monetary union ”. 1 during this conference, fabio canova assured us that the maastricht treaty and the creation of the ecb have not triggered any major structural changes in the features of business cycles and the transmission of shocks. however, it was not clear ex ante that we would come to this conclusion ex post. furthermore, this result is probably not unconnected with the behaviour and strategy of the ecb. in this respect, it is not an argument against the ecb ’ s cautious behaviour. a second example of how limited forecasting abilities impact on monetary policy strategy