the ecb – like many other central banks – has decided to develop its own research capability from its start. first, central banks need research - oriented economists to follow the latest developments in economics and to recognise their potential relevance for policy - making. let me provide an example based on the sustainability of a country ’ s external imbalance – a topic that greatly benefited from the work of professor rey. the literature has recently pointed to the limits of traditional approaches to the balance of payments, where currency depreciation provides the bulk of the adjustment needed to correct a country ’ s current account deficit. traditional approaches fail to realize the consequences of financial globalization for the sustainability and adjustment of the external position. in the presence of variation in asset returns, cross - border asset holdings introduce valuation effects that decouple the dynamics of net foreign assets from that of current accounts, altering the role of the trade balance in correcting a country ’ s external position. recent research at the ecb has been very enlightening in this respect. a second reason for conducting research in a central bank is that a major task of central bank research is to bridge the possible gap between academics and policy makers and to create occasions for interactions with the academic community where the diversity of views can be expressed and discussed. for instance, at the ecb we are convinced that a thorough analysis of monetary developments – our “ monetary pillar ” – is important for the conduct of monetary policy and for the anchoring of inflation expectations. our view is supported by the strong empirical link between money growth and inflation over the long - run and by theoretical considerations relating to the ability of monetary and credit aggregates to point at imbalances in the financial system and inflationary risks. looking at the historical experience, the analysis of monetary developments has helped the ecb to assess the risks to price stability, to identify the nature of the shocks impacting on the euro area and to signal its medium - term orientation. this has been a key factor in anchoring agents ’ expectations and in establishing the high credibility of the ecb. to broaden and deepen the monetary analysis we trust that it is important for us to have an ongoing, direct and candid openness to discussion with the academic world. an example is provided by the 4th ecb central banking conference on " the role of money and monetary policy in the twenty - first century ", where the ecb engaged in an open debate with academics on this important topic. a third argument to invest in central

ensuring all communities in our nation have access to affordable credit. these principles — connect, convene, and catalyze — will continue to guide us forward as we grow our outreach programs and drive progress. they are the ways we contribute to an economy that works for everyone, above and beyond the high - level levers of interest rates and asset purchases. conclusion i ’ ll conclude where i began. as a policymaker i ’ m constantly weighing up the dual mandate, thinking about how we keep the economy on track, and balance maximum employment with low, stable inflation. but these decisions don ’ t affect the kinds of jobs that are created or who benefits from growth. the type of growth we have, where it manifests, and who benefits from it play a huge role in shaping both the fabric of society and the lives of new yorkers. that ’ s why our community and outreach programs are so important to me. i ’ d like to close by reemphasizing my gratitude for your commitment to this city. community development work is complex, challenging, and never done. but it ’ s essential for building healthy communities that support everyone to reach their full economic potential. thank you. i look forward to your questions. 1 see economic press briefing on wage inequality in the region, august 10, 2017. 2 see community reinvestment fund, usa and u. s. bank partner to expand access to credit for small businesses, business wire, january 8, 2018. 4 / 4 bis central bankers'speeches