' speeches line with the target. the third option is price - level targeting, including its various offshoots, such as nominal gdp targeting and temporary price - level targeting. in such a regime, the central bank commits to keep the price level near a steadily growing target path. like average - inflation targeting, this strategy promises to overshoot the target inflation rate in “ good ” times to make up for the inflation undershoot when policy is constrained. in theory, both average - inflation and price - level targeting can solve the problem of anchoring inflation expectations at the target rate while maintaining a low inflation target rate amid low neutral rates. although price - level targeting is a bigger leap from inflation targeting than averageinflation targeting, each can be implemented in ways that are very similar to standard inflation targeting, either in terms of forecast - targeting or a policy rule. 6 importantly, neither will likely be effective in practice unless communicated clearly and carried out consistently over time. more broadly, all of these proposed strategies face potential costs and benefits — in terms of macroeconomic performance, communication, and robustness to uncertainty — which require careful study. in considering alternative monetary policy strategies, academic experts, policymakers, and others from around the world have an important part to play, sharing and discussing ideas and comparing experiences to help all of us to think through these issues. this process of careful study and discussion proved highly valuable during the development and implementation of inflation targeting in decades past, and will be equally valuable in the present debates. thank you. 1 see federal reserve to review strategies, tools, and communication practices it uses to pursue its mandate of maximum employment and price stability, november 15, 2018. 2 shigeaki fujiwara, yuto iwasaki, ichiro muto, kenji nishizaki, and nao sudo, developments in the natural rate of interest in japan, bank of japan review 2016 - e - 12 ( october 2016 ) ; kathryn holston, thomas laubach, and john c. williams, measuring the natural rate of interest : international trends and determinants, journal of international economics, volume 108, supplement 1, pp. s59 – s75 ( may 2017 ) ; thomas laubach and john c. williams, measuring the natural rate of interest redux, business economics, volume 51, issue 2, pp. 57 – 67 ( july 2016 ) ; john c. williams, monetary policy in a low r - star world, frbsf economic letter 2016

prior notice, suspend the auctions temporarily for short or longer periods when the depth of the foreign exchange market is lost due to exogenous shocks or unforeseen extraordinary developments, and when the resulting excessive volatility and unhealthy price formation are observed in foreign exchange rates. on the other hand, the central bank will continue to closely monitor the volatility in exchange rates also in 2007 and will directly intervene in the market in the event of actual and potential excessive volatilities. banks will be able to borrow foreign exchange in terms of usd and euro from the central bank within the predetermined limits with a one - week maturity in the foreign exchange and banknotes marketforeign exchange deposit market in the upcoming period too. moreover, the purchase / sale transactions of “ foreign exchange against foreign exchange ”, “ foreign exchange against foreign banknotes ” and “ foreign banknotes against foreign banknotes ” conducted between the central bank and institutions authorized to operate in the foreign exchange and banknotes markets will continue. in conclusion, as can be understood from the general framework and our exchange rate policy implementations described above, exchange rates are established by supply and demand conditions in the foreign exchange markets under the implementation of the floating foreign exchange regime. the key determinants of foreign exchange supply and demand are the monetary and fiscal policies and the economic fundamentals determined by the structural reform process and expectations. it should be borne in mind that in a floating exchange rate regime, economic agents operate in an environment of exchange rate risk. nevertheless, as repeatedly emphasized by the central bank, exchange rate risk is a manageable risk and economic agents should establish the mechanisms that will ensure the efficient management of this risk. liquidity management excess liquidity, which was created by the central bank ’ s purchases of government securities worth of ytl 14 billion from state - owned banks and banks transferred to the savings deposit insurance fund ( sdif ) in order to meet their liquidity needs following the february 2001 crisis, as well as the intensive foreign exchange purchases during the 2003 - 2005 period, persisted in 2006. the central bank, withdrew the excess liquidity in the market mainly via new turkish lira deposit operations in the interbank money market within the cbrt and repo transactions in the repo and reverse repo market of the istanbul stock exchange, on an overnight basis. accordingly, overnight interest rates were constantly realized around the borrowing rate of the central bank. hence, the borrowing rate of the central bank