of issues whether it is around financial resilience, better management of conflicts of interest, or greater transparency and security for customers. conclusion to finish where i started, smil posits that a realistic grasp of our past, present and uncertain future is the " best foundation " for approaching the unknowable expanse of time ahead of us. we cannot be specific but know it will include both progress and setbacks. " the future, as ever, is not predetermined, " he writes. " its outcome depends on our actions. " 7 / 8 bis - central bankers'speeches as a regulator, when thinking about the complexity of new terrain and its many challenges, that call to action chimes greatly with me. in concluding, let me emphasise that, in the central bank of ireland, as we cover new ground, we do not move in isolation or with our peer regulators only. we are an open and engaged regulator, knowing the importance of listening to our stakeholders, building dialogue and being open to feedback. we don't just welcome your continued engagement – we see it as essential to our mission of serving the public interest by maintaining monetary and financial stability while ensuring that the financial system operates in the best interests of consumers, investors and the wider economy. thank you for your attention and i wish you an enjoyable and productive conference. 1 with thanks to jonathan dent, caroline mehigan, kevin mullen, cian murphy, james o'sullivan and darragh rossi for their support in preparing this speech. 2 smil, " how the world really works " ( 2022 ) penguin. 3 makhlouf, " the central bank's regulatory philosophy : regulating for stability and positive outcomes " ( 2022 ). 8 / 8 bis - central bankers'speeches

a whole. this puts us at the top of the league table. some of the rise in headline inflation can be ascribed to once - off or temporary factors - such as the rise in excise duty on cigarettes, higher oil prices and weakness in the euro. there is, however, a strong rise in underlying inflation which for the most part reflects the existence of strong demand. nobody claims that inflation here must be at precisely the same level as in the euro area generally. it is reasonable to expect some differential at this time in view of our economic conditions but there are obvious limits. the point i want to emphasise is that, if present trends persist, we may have a sharp loss of competitiveness on our hands. one of the inevitable consequences of an integrated european economy and a single currency is the strong tendency to centralise financial activities in the larger centres and an increase in cross - border competition. this is a threat to the irish financial services industry, which has been expanding vigorously in recent years. it is compounded by the pressures within the industry for mergers and acquisitions, which are driven by new technology and the perceived benefits of economics of scale. i would like to believe that in ten years from now we will continue to have a vibrant indigenous financial services industry. i would be optimistic that the international financial services centre will continue to grow and evolve as an integral part of our financial system. conclusion after years of preparation, emu is now a reality. in time, we will undoubtedly benefit from being part of an economy whose currency has a leading international status. we will benefit also from internal price stability and the security that this brings. we must not lose sight of the reality, however, that membership of the euro area also imposes new disciplines, which will be put to the test at some stage. there is no provision in the eurosystem for a bail - out in the event that any member encounters serious economic difficulties. we can no longer fall back on the exchange rate or interest rates. we can no longer control credit. these options are gone. having said this, the advantages of being part of the euro area should well outweigh the disadvantages in the long term. i am confident that we will come to realise this more and more as time goes on.