individuals and businesses. the eurosystem is committed to keeping pace with innovation in financial services while, at the same time, safeguarding the safety and efficiency of our financial market infrastructure. tips has the potential to be the underlying infrastructure that will facilitate instant payments across europe. it will provide the basis for innovative payment services to flourish and, in tandem with the services offered by achs, it can help foster pan - european reachability. 3 / 4 bis central bankers'speeches for psd2 to achieve its objective regarding access, innovation and a level playing field, it is important that several aspects of the legal and regulatory framework are clarified and implemented in a consistent manner – in particular when psd2 takes effect in january 2018 and the respective rts iater in 2019. in this context, the authorities should consider how the new directive and derived regulatory technical standards will work in conjunction with instant payments. moving beyond the legal requirements, i also encourage market stakeholders in the euro retail payments board to agree on the technical, operational and business requirements. the success of this endeavour can be achieved in a spirit of cooperation. thank you. 4 / 4 bis central bankers'speeches

lags in, the effects of a change in the monetary policy stance on the price level an output over time. an important implication of the central role of expectations in the monetary policy transmission process and of the “ rationality ” of expectations – in a broad sense – is that the effectiveness of monetary policy depends on the expectations of the markets and of the public about future policy actions. and this is the fundamental reason why the adoption and public announcement of a quantitative definition of price stability ( or an operational inflation objective ), the credible commitment of the central bank to this objective, and the effective communication of its policy decisions aimed at achieving this goal are crucial for the anchoring of inflation expectations to price stability. our own experience and the track record of the ecb since 1999 have been very positive in this respect : despite the fact that the ecb, as a newly created central bank, did not have a previous track record of successful policy - making, financial markets immediately understood the ecb ’ s commitment to price stability as credible and factored it in their expectations. ever since 1999, all financial market indicators and private sector forecasts suggest that expectations of future inflation have remained remarkably well anchored to the ecb ’ s definition of price stability. for example, expectations derived from the prices of nominal and indexed - linked bonds provide compelling evidence that long - term inflation expectations are well anchored in the euro area. however, while market expectations appear to be “ rational ” in that they are in line with the ecb ’ s commitment and demonstrated ability to preserve price stability, the process of expectation formation among the general public appears to be rather more complex. survey evidence suggests that in a number of euro area countries, a portion of the general public perceives inflation to deviate sometimes significantly from actual inflation or expects inflation to remain at elevated levels which bear little resemblance to actually recorded inflation or market expectations of future inflation. more analysis is needed to understand this discrepancy – and some promising work has already been done at the ecb in this respect. more generally, research aiming at incorporating empirically plausible theories of expectations formation into our models is of particular relevance. this will require the introduction and testing of hypotheses of how economic agents learn about the evolving structure and functioning of the economy it and may lead to a relaxation of the assumption of the representative agent which is characteristic of most of our models, including the dynamic stochastic general equilibrium ( dsge ) models, and thus to allow for the hetero