policy or with the next interest rate decision. as a rule, central banks direct their attention to both price stability and the stability of the financial system as both subjects are very much intertwined. in my opinion, this simple observation has far - reaching implications for a central bank ’ s research programme. if a central bank ’ s research is to develop on well - organised lines, it has to be “ from the top down ”, with the objectives as the primary focus. you all know, that price stability has long been established as the first objective of central banks and therefore price stability has been and will remain the first objective of central bank research. as i see it, financial stability has now become the second top issue for central bank research. alongside and in cooperation with other departments, our research centre takes an active role in this field. for example we look at the implications of changes in the german financial system for financial stability, the implementation of lending of last resort functions and the link between the soundness of the banking system and its credit supply. in addition, other projects are dedicated to the role of financial intermediaries in the business cycle in germany. furthermore, we investigate the best framework for implementing stress tests for the financial system in germany. on top of this there is no doubt that the financial stability issue has a very important international dimension, which is a big challenge for further research. last but not least our research concentrates on the refinement of econometric models and forecast methods. in this regard, we are particularly interested in promoting the development of “ dynamic stochastic general equilibrium models ” for the use within the bundesbank. these models have become a backbone of theoretical as well as empirical analysis. in modern economic research these approaches provide a consistent framework which connects theoretical foundation with empirical evidence. we at the bundesbank are aware of the necessity to include these methods in our tool box of economic methods. consequently, our research programme contains several projects which will use general equilibrium models. as an example, based on earlier papers by jana kremer, giovanni lombardo and thomas werner, the interaction between monetary and fiscal policy, is to be illustrated in more detail. another project will deal with the cyclical behaviour of beliefs in dsge models. the sheer scope of these research topics constitutes a major challenge for research management. essentially, this is a matter of how research within a central bank is to be organised. i believe research centres like ours at the bundesbank are essential

burkhard balz : public - private partnership - key to the success of a digital euro speech by mr burkhard balz, member of the executive board of the deutsche bundesbank, at the bitkom digital euro summit, virtual event, 15 november 2022. * * * 1 introduction ladies and gentlemen, thank you for your warm welcome to today's digital euro summit. where better to talk about an innovative topic like this than at an event organised by one of germany's largest digital associations? as my virtual participation exemplifies, the digital transformation is fundamentally changing countless aspects of our lives. we are living in times where it seems that practically everything is in a state of flux. that is not only a reference to the fact that football world cups are no longer being played in the wonderful summertime, but in the winter months. changes can be observed in the world of payments as well. driven by digitalisation, new payment methods are emerging and, with them, new providers of innovative payment services. these developments are also impacting on central banks'roles as backbone of payment systems, prompting us to find new answers to new challenges. one answer could be to make our currency, the euro, ready for the digital world of tomorrow. these discussions are centred around the concept of central bank digital currency, or cbdc for short. so let me begin by outlining why we are exploring a digital euro. after that, i will present the potential core features a digital euro might have, before updating you on the current project status. 2 why are we considering issuing a digital euro? why are we considering issuing a digital euro? first of all, we have been seeing a trend towards cashless payments for years now – and that trend even accelerated recently. if we look at germany, for instance, the bundesbank found, in its regular study on payment behaviour that the share of cash transactions of consumers'daily payments has fallen to 58 %. 1 the trend is obvious : in a study from 2017, cash payments accounted for 74 %. one of the main effects we saw was the growing popularity of contactless payments – in particular in the form of card payments. while roughly 20 % of smartphone owners have already paid using digital wallets, total mobile payments still account for only 3 % of all daily payment transactions. it was with great interest that i read the recent results of a bitkom survey, confirming the trend towards cashless, and in particular