##ised banks, they can end up effectively shifting the burden onto monetary policy ) and at macro - level ( if supervisory policies allow banks to grow too rapidly, and then deleverage too slowly, it can also push the central bank into doing more ), which can turn out in the ineffectiveness of monetary policy transmission mechanism. let me say a few words about the issues of central bank independence in the context of required cooperation with the government in the post - crisis world. as we all know, from a historical perspective the prevalence of central bank independence is a relatively new institutional development, seen as a solution to the problem of time inconsistency of monetary policy and the stagflation of the ’ 70s. is the post - crisis reality likely to dissolve the consensus about central bank independence? after all, the danger of inflation is hardly a pressing concern nowadays ( but rather the lack of it ) and the pursuit of financial stability is ultimately a shared responsibility, since it implies close cooperation with the government and other authorities and may ultimately involve recourse to public funding. i share stanley fisher ’ s view that it would be a costly mistake to give up central bank independence. that would mean “ the benefits of having a central bank that can take a longer term and apolitical view of what is good for the economy and take actions in support of that view will be lost ”. if a long - term perspective and a shield against political pressure are required for achieving price stability, these may be even more important if explicit concern for financial stability is added. and frankly, i do not see the need for close cooperation with the government as something that implies abandoning central bank independence, but rather as a pre - requisite – which has always been there – for promoting effective policies. irrespective of how well - designed the policies of the central bank may be, they cannot substitute for a consistent macroeconomic policy mix, and in the absence of this consistency they are likely to achieve at best sub - optimal outcomes. having said that, i think there are a few questions worth asking – i must confess i do not have the answers, but i believe that the future of central banking hinges upon them. • would it be necessary to promote a certain tactical flexibility in the conduct of monetary policy, so that central banks might carry out adjustments in terms of objectives as well, not only instrument - wise? such an approach would diminish the predictability of monetary policy, but would allow, when need be

1. 8 % in 2025. however, confidence does not preclude vigilance ; even if the recent rebound in inflation is technical and temporary – it was actually less than expected in december. page 2 of 5 in the face of inflation, monetary policy has proved to be an effective remedy : in france, core inflation ( i. e. manufactured goods and services, which account for 70 % of household consumption baskets ) fell from 4. 7 % in april, to 2. 9 % in december. at the same time, we have managed to avoid a recession and maintain positive growth – even though this has undeniably slowed. this soft landing of 0. 9 % growth in 2024 should precede a gradual recovery from 2025 on. in this context – and barring any surprises – 2024 should be the year of our first interest rate cuts. i am aware that you are waiting for me to say in which season – spring, summer or autumn? – or even in what month. well, actually no : our decisions will not be guided by a timetable but by data ; and we must display neither obstinacy nor haste. neither obstinacy : i have never believed that worries over the “ last mile ”, where inflation would become harder to bring down and would justify an excessively rigid monetary policy. nor haste either : if you will allow me to paraphrase la fontaine : " patience and time do more than a lot of talk ". we will cut rates this year when the inflation outlook is firmly anchored at 2 % – in actual data – and on a sustainable basis – in forwardlooking data. 1. 2 less protection and more adaptation last year i stressed that the government could cushion the energy shock temporarily but could not make it disappear. subsidies have since been partially removed thanks to the favourable movement in wholesale energy prices and government decisions. after costing eur 37 billion in 2023, the cost could be eur 10 billion in 2024, the bulk of which would be accounted for by the electricity price shield. depending on price trends, we could expect to see an even greater reduction before they are removed altogether. there is a more general lesson here for our economic and fiscal policy : rather than ex - post compensatory public expenditure – which has become a french speciality – the real key is everything that beefs up our productive capacity upstream through three major supply - side transformations : the energy transformation ; the digital transformation ; and