, crunches and busts? ”, economic policy, vol. 24, 2009 ; a. abiad, g. dell ’ ariccia and b. li, “ creditless recoveries ”, imf working paper 11 / 58, 2011. the current situation in credit markets is well documented in economic analysis, whereby the high risk of default and the difficulty of assessing the solidity of borrowers leads to adverse selection and increases intermediaries ’ risk aversion, giving rise to credit rationing. see j. stiglitz, and a. weiss, “ credit rationing in markets with imperfect information ” ( 1981 ), the american economic review. oecd, financing smes and entrepreneurs : an oecd scoreboard, oecd publishing ( 2013 ). conducted on a sample of manufacturing firms that benefited from the fund ’ s intervention between 2005 and 2010. bis central bankers ’ speeches over the coming months the fund ’ s activities may benefit from the changes introduced under law 98 / 2013 and the 2014 stability law. however, these must be implemented rapidly : some of the changes, in particular those designed to facilitate the granting of guarantees to firms whose balance sheets have been weakened by the recession, are still awaiting implementing decrees. moreover, the prospect that a portion of the funds assigned by the stability law could be channelled to other areas of activity and for purposes other than supporting firms, risks dissipating the fund ’ s resources and eroding its effectiveness. finally, to stimulate the supply of loans there is a need to introduce mechanisms that reward banks with the highest rates of increase in total lending. further interventions to support credit have been made by the public sector through the cassa depositi e prestiti. 14 in the private sector, the moratoriums agreed between the italian banking association and firms ’ associations have enabled many smes to weather difficult times. but to get the credit channel working again, banks must first and foremost commit to taking full account of their customers ’ growth potential. the pressure on banks to deleverage and, in the years leading up to the crisis, the growing importance of types of financing that can be sold on the market may have impaired the ability and incentives for banks to analyze the prospects of the various business sectors and carefully assess borrowers ’ creditworthiness. this negative trend must be halted, by intensifying efforts to examine the characteristics of firms, and of smaller firms in particular. banks must be aware of

payments, and demand from rental car companies. at the same time, the supply of vehicles has been held back by earlier production cutbacks and shortages of semiconductor chips. this imbalance in supply and demand has caused used car prices to soar. looking forward, supply will slowly come back online, and i therefore expect car prices to stabilize and then decline over time to more normal levels. 2 / 3 bis central bankers'speeches we have already seen this type of dynamic play out in some sectors. the latest data show growth in wholesale used car prices slowing in the first half of june. 4 and lumber prices, which soared during the pandemic as housing demand surged and supply struggled to keep up, have declined sharply in recent weeks. i expect that as price reversals and short - run imbalances from the economy reopening play out, inflation will come down from around 3 percent this year to close to 2 percent next year and in 2023. it goes without saying that there is a great deal of uncertainty about the inflation outlook, and i will be watching the data closely. the fed ’ s policy response it ’ s clear that the economy is improving at a rapid rate, and the medium - term outlook is very good. but the data and conditions have not progressed enough for the fomc to shift its monetary policy stance of strong support for the economic recovery. specifically, the fomc decided last week to maintain the target range for the federal funds rate at zero to ¼ percent and made no changes to its program of asset purchases. in thinking about adjusting its stance in the future, the fomc has defined conditions and measures that will inform its decision - making. in terms of the federal funds rate, the fomc said it expects it will be appropriate to maintain this target range until labor market conditions have reached levels consistent with the fomc ’ s assessments of maximum employment and inflation has risen to 2 percent and is on track to moderately exceed 2 percent for some time. the fomc also said it will maintain its current asset purchase pace until substantial further progress has been made toward its employment and inflation goals. 5 conclusion i hope you remember the “ things we said today, ” but if not, here ’ s my final message. the sun is shining, both literally and figuratively. progress on vaccinations and the economy is very welcome news, and i look forward to a full and complete recovery, accompanied by inflation that averages 2 percent over time.