jean - claude trichet : introduction and chair of the panel on “ stylised facts of globalisation and world inflation ” speech by mr jean - claude trichet, president of the european central bank, at the international symposium on “ globalisation, inflation and monetary policy ”, organised by the bank of france, paris, 7 march 2008. * * * i would first like to thank the organisers of this banque de france international symposium for their invitation to chair this panel on “ stylised facts of globalisation and world inflation ”. i am particularly glad to have the opportunity to participate in this panel, as discussions regarding the conduct of monetary policy in a global economy are a constant feature of our policy analysis and research at the ecb. we are fortunate to be joined today by professor kenneth rogoff, who will be talking about globalisation and monetary policy, providing a general overview and looking at some recent issues. professor rogoff has produced remarkable research in the area of international macroeconomics and monetary policy and is therefore the ideal speaker for this morning ’ s presentation. kenneth rogoff started his career at the federal reserve, was chief economist and director of research at the imf and is now a professor at harvard university. richard fisher will be the first discussant. richard fisher was deputy us trade representative from 1997 to 2001 and is now president of the federal reserve bank of dallas. our second discussant will be john lipsky, who was chief economist and vice chairman at jpmorgan before being appointed first deputy managing director of the imf. and professor philippe martin will be our third discussant. philippe martin, whose research in the field of international macroeconomics has been published in numerous leading journals, is a professor at the university of paris i pantheon - sorbonne and a membre de l ’ institut. i look forward to listening to the contributions of this very distinguished panel to the ongoing debate regarding the links between globalisation and inflation. over the last 15 years the world has witnessed a substantial and continuous decline in the level of inflation that has coincided with the advent of the global economy. the natural question to ask is therefore whether globalisation has been one of the main factors driving price moderation. with the development of international trade, competitive pressures from low - cost countries have indeed helped to control prices and wages, especially in the manufacturing sector. pressure to innovate has probably also boosted productivity, with beneficial effects for inflation. the question is therefore whether these channels

will be enough on their own. as continental europe ’ s financial markets adapt to the new post - brexit reality, we could see one or several financial centres emerge, possibly in competition with each other, or perhaps not competing but rather specialising in certain areas. if the eu - 27 financial markets deepen, diversify and expand across borders, there is a clear flipside : these developments will need to be accompanied by sufficient oversight and tools to avoid the build - up of risks in certain parts of the system. that is why, in my speech yesterday, 3 i called for the macroprudential toolkit to be expanded to address potential risks around interconnection, liquidity, leverage and cross - border activities of non - bank financial institutions – in particular, investment funds. i also argued that we should consider elevating the responsibility for supervising these institutions, and potentially activating macroprudential tools, to the european level. more consistent market oversight and enforcement of the relevant regulations will level the playing field. it will also facilitate cross - border integration because market participants will know they will be subject to the same rules across borders. at the same time, more centralised supervision would prevent harmful regulatory arbitrage. ultimately, as a long - term goal we could also consider creating a single supervisor for capital markets. reaping the benefits of financial integration after brexit while safeguarding stability developing a sound institutional framework to ensure sustainable financial integration is also at the core of my second point – the eu ’ s future relationship with the united kingdom in the field of financial services. to be clear, the ecb does not participate in brexit political negotiations. so i will only be outlining considerations from the perspective of our monetary policy mandate, our supervisory responsibilities and our role in promoting financial stability. the single market includes a common rulebook for financial services and an institutional framework of supervisory and oversight authorities. this framework allows european and national authorities to cooperate, exchange information and manage opportunities and risks arising in the single market. it is a careful balancing act between integrating member states ’ financial markets on the one hand, and safeguarding national and european financial stability on 2 / 5 bis central bankers'speeches the other. the united kingdom ’ s decision to leave the single market and its institutional framework means we have to perform an additional balancing act – one where we balance ensuring that eu financial markets are integrated and can interact efficiently with a non - eu country against the need to safeguard financial