klaas knot : inflation strikes back - drivers and policy reactions speech by mr klaas knot, president of the netherlands bank, at the 25th annual dnb research conference " inflation strikes back : drivers and policy reactions ", amsterdam, 10 november 2022. * * * welcome everyone! this is a sight for sore eyes : a whole room full of real - life delegates! a posse of bankers, a pride of economists, a pack of scientists. or whatever the proper collective noun would be for a gathering like this - i only know we are a collective. because we share an interest, a passion, a purpose : we are interested in economic developments. my interest in economics was triggered by the great inflation of the 1970s. i remember my parents'distress about exploding mortgage costs, the fuel coupons, the empty roads on sundays, our concerned prime minister on television warning us that nothing would ever be the same againand i wondered : how on earth could this happen? and, what could be done? how can we prevent this from happening again? so i studied economics, i worked in public policy, i became a central banker. and i learned that economics is not a selfcontained science, there is never one right answer that stays right forever, like in a hard science such as mathematics. as john maynard keynes one said : " the master - economist must possess a rare combination of gifts. he must reach a high standard in several different directions and must combine talents not often found together. he must be mathematician, historian, statesman, philosopher - in some degree. he must contemplate the particular in terms of the general, and touch abstract and concrete in the same flight of thought. " that is our challenge : to come up with different ideas, combining different talents and different perspectives, in response to the problems of our times. with a big advantage of our time : economists are not only'he'anymorecoming up with ideas, that is what we, what you, will do during this conference. in answer to the problem of today, because inflation is back. with a vengeance. last october hicp inflation reached 10. 7 percent, with some heterogeneity among euro area countries. here in the netherlands we are experiencing a 16. 8 annual percentage change in the overall level of prices. like in the 1970s, the current high inflation is rooted in energy price shocks, this time as a result of the war in ukraine. however, recent analyses show that supply

had made it clear that the suffering of long ago is far from over, that the fight is far from over. we therefore choose not only to apologise today. we are opting for more than just words, but also for deeds. deeds that will hopefully contribute to the fight against racism, inequality and injustice. deeds that we can accomplish today. deeds that will set us on course for a more inclusive future : we are setting up a fund that we will use to finance projects in the service of society – projects related to education, healthcare, employment and more. projects in the netherlands in the caribbean and in suriname this fund will projects in the netherlands, in the caribbean and in suriname. this fund will finance projects worth €5 million over the next ten years. in addition, we are providing one - off funding of an additional €5 million for a number of larger initiatives such as the national research centre on the history of slavery. we are also closely examining our own organisation. we need to become more diverse and more inclusive, and we will put forth every effort to make that happen. we must ensure that we ar e better able to detect and recognise racism and respond to it decisively. and we intend to boost diversity at de nederlandsche bank in our recruitment & selection procedures, through internships and traineeships, and in promotions. moreover, we will not conceal our past, which we have now come to know more acutely. our history will be given a prominent place in our amsterdam headquarters, serving as an invitation for further dialogue. a dialogue that we will also pursue using works of art from our vast collection, a collection which we will moreover recast with greater emphasis on diversity. the words i speak today, and the deeds i am announcing today, do not signify the end of a journey for de nederlandsche bank, but rather a turning point. for de nederlandsche bank, 1 july 2022 signifies a touchstone as we look to the future. a future in which dnb is more inclusive. a future – i hope – with a more inclusive society. a future – i hope – with each other. thank you for allowing me, on behalf of the entire executive board of de nederlandsche bank, to stand before you here today and deliver this message.