to obtain a concise estimate of all monetary developments. 3. total domestic debt is an important indicator. it helps the banque de france make sure that the economy is supplied with enough financing to grow, and it enables us to track developments in financing for businesses, households and general government simultaneously. the monetary policy council will keep a close eye on other indicators, including all leading indicators of changes in prices, such as capacity utilization rates, production costs, developments in incomes and commodity prices. the monetary policy council will also monitor long - term interest rates and the current account balance. * * * these decisions call for two remarks. first, on a technical level, the monetary policy council has decided to monitor several narrow and broad money aggregates simultaneously in order to obtain a concise estimate of all monetary developments. as we have seen, certain data, and particularly, but not exclusively, m3 data, have been severely disrupted recently by several factors, such as the very substantial fall in short - term rates and the ensuing large - scale reallocation of investment flows towards non - monetary assets, higher taxes on money market mutual funds, and the continuing very high level of interest paid on housing saving plans. we will therefore keep a very close eye on the m1, m2, m3, and m3 + p1 aggregates as expressions of the underlying growth of the money supply. particular attention will be paid to the growth of the m3 + p1 aggregate covering monetary assets and contractual savings. a very large proportion of the outflows from m3 in the past year was directed towards investments covered by p1, and particularly housing savings plans with a residual maturity of one year or less. in fact, this type of investment at present constitutes a very close substitute for monetary assets. second, the monetary policy council has set monetary policy against the background of potential growth for the french economy of around 2. 5 % per year. we consider the average growth of our economy in the medium - term, and it could be exceeded given that we have a potential to catch up in the medium term. we reckoned with a maximum price increase of 2 % and potential real growth of between 2. 5 % and 3 % in the medium term to arrive at a figure of 5 % for the medium - term growth trend of the money supply. * * * it is very important to bear in mind the essence of the policy implemented by the monetary policy council. parliament confers on the banque de france an objective, namely the objective

francois villeroy de galhau : monetary and fiscal policy - mix addressing the disease of inflation speech by mr francois villeroy de galhau, governor of the bank of france, at the eurofi financial forum 2023, santiago de compostela, 15 september 2023. * * * ladies and gentlemen, it is a great pleasure to be here for this final day of the traditional september eurofi meeting, and i extend my warmest thanks to didier cahen and david wright for organising this event, this time in the holy city of santiago de compostela. let me start with good news about a favourite eurofi topic : banking regulation and basel 3. i say it as bis chair and former chair of ghos : we had in monday an important ghos meeting in basel, and we unanimously welcomed the decisive progress made this year in the implementation of basel 3. by 2025, all jurisdictions – including europe and – yes – the us – should have implemented it in a broad compliance with the standards. i know each banking industry, on both sides of the atlantic, tends to consider that the other side has undue advantages. it's simply not right, and our motto is now straightforward : let us now close this page, and implement the european compromise, no less and no more. no less as some banks would perhaps still dream of, and no more as some theoreticians of regulation would perhaps imagine. and we should now turn to the priority learned from the banking turmoil : " strengthening supervisory effectiveness " i rather than focusing on further regulation. let me now turn to my theme which is the policy mix to fight our main economic disease : inflation. well, santiago has not yet produced a miracle for inflation, but there is indeed some encouraging news : headline inflation has passed its peak since the beginning of 2023, and it seems that core inflation is following suit. indeed, the latter started to recede, to stand at 5. 3 % in august ( down from 5. 5 % in july and 5. 7 % in march ) in the euro area. obviously, these inflation rates remain too high : we must and we will bring inflation back towards our 2 % target by 2025. i reiterate this morning this clear commitment which is fully consistent with our latest ecb forecasts. monetary policy is the first line of defence, and the main remedy for this disease. i won't make comments about yesterday's governing council and monetary decision