deal with the present. the economic environment in which we operate today is a direct consequence of the demographic and productivity shifts taking place. low neutral interest rates are very real, and they ’ re here to stay. conclusion the facts have changed, and so it is time to change our minds also. it is often said that change is hard. but, experience teaches us that it is better to prepare for the future than wait too long. ultimately, failure to prepare often means preparation for failure. 1 united nations, world populations prospects : key findings and advance tables, 2015 revision. 2 antonin bergeaud, gilbert cette, and remy lecat, productivity trends in advanced countries between 1890 and 2012, review of income and wealth, volume 62, issue 3, pp. 420 – 44, september 2016. 3 shigeaki fujiwara, yuto iwasaki, ichiro muto, kenji nishizaki, and nao sudo fujiwara, developments in the natural rate of interest in japan, bank of japan review, october 2016 ; kathryn holston, thomas laubach, and john c. williams, measuring the natural rate of interest : international trends and determinants, journal of international economics, volume 108, supp. 1, pp. s59 - s75, may 2017. 4 thomas m. mertens and john c. williams, tying down the anchor : monetary policy rules and the lower bound on interest rates, federal reserve bank of san francisco, working paper series, may 2019. 5 richard h. clarida, vice chair of the board of governors of the federal reserve system, the federal reserve ’ s review of its monetary policy strategy, tools, and communications practices, speech delivered at the federal reserve bank of minneapolis, april 9, 2019. 3 / 3 bis central bankers'speeches

william c dudley : panel remarks at the 7th high - level conference on the international monetary system panel remarks by mr william c dudley, president and chief executive officer of the federal reserve bank of new york, at the 7th high - level conference on the international monetary system, zurich, 10 may 2016. * * * linda goldberg and joseph tracy assisted in preparing these remarks. it is a great pleasure to have the opportunity to participate in this panel. to me, the question posed for discussion seems relatively straightforward : will more reserve currencies strengthen the international monetary system? my answer can be summed up in one word : “ yes. ” i believe that a reserve currency – or at least an enduring and important one – has to have a number of demonstrated attributes. these include that the reserve currency country has a strong and credible institutional structure ; that its policymakers follow a sustainable fiscal regime as well as a monetary policy that keeps inflation low and stable over time ; and that the currency is readily convertible and serves as a stable store of value. these are good attributes for any country – reserve currency or not. the greater the number of countries that have such attributes, the more stable and sound the global financial system is likely to be. also, such a regime is desirable because it provides an environment that should encourage international trade and an efficient allocation of resources, which, in turn should lift productivity and living standards. as always, what i have to say today reflects my own view and not necessarily those of the federal open market committee or the federal reserve system. although a reserve currency can formally be defined as any currency that is part of a foreign country ’ s foreign exchange reserve holdings, i do not think this is what we have in mind when we talk about a reserve currency. while the status of being a reserve currency can be conferred, the stature of being a reserve currency must be earned. as i see it, a successful reserve currency needs to satisfy a number of conditions. first, the currency needs to be fully convertible – with no risk of restrictions that could limit the ability to convert such holdings into cash denominated in the investors ’ domestic currency. second, the reserve currency country needs to have deep, liquid and transparent capital markets so that the sovereign debt instruments and other highquality debt obligations can be bought and sold at narrow bid - ask spreads and easily converted to and from cash. third, the assets in the country must be governed by a wellunderstood, consistent and enforceable legal regime