mr george takes a look at recent developments in the uk economy against the background of global influences in the international financial environment speech given by the rt hon eddie george, governor of the bank of england, at the city council dinner hosted by the glasgow chamber of commerce on 18 january 2000. * * * mr chairman, my lord provost, ladies and gentlemen, i always enjoy my visits to scotland. and i ’ ve been particularly looking forward to this visit since i read a business comment headline, in one of your newspapers on friday, referring to the warm welcome i could expect on this occasion - following last week ’ s decision by the monetary policy committee to put up interest rates! it has to be said that some of the rest of the article, and some other press comment on friday was less welcoming! we - the mpc - were variously accused of “ ignoring the pain suffered by firms north of the border ”, of “ being willing to sacrifice scotland ’ s economy just to cool the overheated london property market ” ; and of causing the scottish economy once again to suffer because south - east england is overheating. well i ’ m a great believer in free speech, but let me give you some relevant facts. the mpc sets interest rates to achieve the government ’ s target for retail price inflation in the uk economy as a whole consistently over time. those are our marching orders. in fact for the past seven years - starting well before the mpc came into existence - the uk economy as a whole has enjoyed the longest period of sustained low inflation that we ’ ve known in over a generation. retail price inflation on the government ’ s target measure has averaged 2. 7 % over that time ( or only 2. 1 % on europe ’ s hicp measure ). alongside low inflation we ’ ve also had the lowest nominal interest rates that most of us can remember. short - term rates have averaged some 6¼ % ( fluctuating between 5 and 7½ % over the period ), compared with some 11¼ % ( fluctuating between 7 and 15 % ) over the previous decade. and ten - year government bond yields have fallen from nearly 9 % on average in 1992 to around 5½ % at the present time. but more than all that, we have also over the past seven years or so enjoyed the longest period of uninterrupted, quarter - by - quarter, economic growth in the uk as a whole since quarterly records began in 1955. annual growth since

miguel fernandez ordonez : immigration and the inflation moderation debate speech by mr miguel fernandez ordonez, governor of the bank of spain, at the symposium “ the phillips curve and the natural rate hypothesis ”, kiel institute for the world economy, kiel, 3 june 2007. * * * introduction it is a pleasure to be here today at this symposium in such distinguished company. the organisers have put together an impressive programme on a key topic for policymakers and central bankers in particular. as you know, the relationship between inflation and economic activity has always been at the heart of the macroeconomics discipline. and theoretical developments in this field have had a significant and direct influence on actual monetary policymaking. we are currently in a unique situation. for an unusually long period, in the context of high global growth, inflation has remained low and stable. many commentators – and not only central bankers – would agree that better - managed monetary policy has had a lot to do with this favourable inflation performance. and there is a lively debate about which specific aspects of monetary policymaking have been responsible for it. let ’ s look at three questions this debate has raised. first, do central bankers now have better knowledge of the economy and of monetary policy transmission and, consequently, are adopting more effective decisions? second, have monetary policy regimes shifted towards making price stability a more prominent target? and third, have structural changes in the world economy, such as the globalisation of capital, production and labour, made the job of central banks easier? i will deal with all three questions today, but particularly with the effects of globalisation. i will focus mainly on labour market aspects, taking the immigration we have seen in spain in recent years as an example of the positive effects that globalisation can have on inflation. what is behind the recent success of central banks ’ in combating inflation? recent studies have given the credit for reducing the high inflation of the'70s and early'80s to the central banks ’ better knowledge of the economy. in my view, these studies have got it right. we have to admit that, at least in some countries, monetary policy didn ’ t do all it could in the'70s to contain the oil shock - induced inflation of that time. perhaps at that time, central banks lacked understanding of how supply shocks affect the output gap, as well as of the role of inflation expectations, and how these relate to monetary policy actions. but i don ’ t think that insufficient knowledge of the economy