; as a liquid investment and source of safe collateral ; as a channel for the implementation of monetary policy ; and, of course, as a tool to help finance u. s. government activities. as the treasury market continues to evolve, several complex questions lie ahead. how should data reporting gaps be closed to ensure that as many relevant treasury transactions as possible are collected? what is the proper scope and best process for sharing treasury market data with the public? how can the joint member agencies and private stakeholders best collaborate to ensure treasury market stability and efficient market function, even as market structure evolves and new technologies emerge? what considerations need to be made regarding treasury market clearance practices given the growth in activity by participants who are not central counterparty members? will the evolving settlement marketplace introduce new challenges to treasury market participants? how must practices and culture evolve as market structure does? and, how will the interplay of all of these issues affect the future of the treasury market? today ’ s conference provides an excellent opportunity to discuss these issues. thank you for coming. i look forward to today ’ s dialogue and the ongoing engagement between the joint member agencies and the public as we all strive to ensure the continued sound functioning of this essential marketplace. 1 joint staff report : the u. s. treasury market on october 15, 2014, u. s. department of the treasury, board of governors of the federal reserve system, federal reserve bank of new york, u. s. securities and exchange commission, u. s. commodity futures trading commission, july 13, 2015. 2 ellen correia golay, frank keane and nathaniel wuerffel assisted in preparing these remarks. 3 the joint member agencies are the u. s. department of the treasury, the board of governors of the federal reserve system, the federal reserve bank of new york, the u. s. securities and exchange commission and the u. s. commodity futures trading commission. 4 best practices for treasury, agency debt, and agency mortgage - backed securities markets, treasury markets practices group, revised february 2016. 5 banking conduct and culture, group of 30, july 2015. 6 opening remarks at reforming culture and behavior in the financial services industry : expanding the dialogue, william c. dudley, october 20, 2016. 7 the role of best practices in supporting market integrity and effectiveness, simon potter, remarks at the 2016 primary dealers meeting, september 7, 2016. 2 / 3 bis central bankers'speeches 3 / 3 bis central bankers'speeches

than 2 per cent ” was shipped intact to the whole union. this remarkable transition might have been helped by the fact that international financial markets were internalising the dawn of a new era of low inflation and high credibility across a wide range of industrial countries in precisely that very same period. this interpretation receives some support from the fact that us long - term bond rates and the implied forward short - term rates were declining as well. 6. fiscal consistency : guarantees for sound fiscal policies enshrined in the treaty in the form of the maastricht criteria and appropriate implementation of these principles by the stability and growth pact regulations. it is my conviction that each and every of these six conditions were and are necessary. my personal conjecture is that the 6 together have proved to be a sufficient set of conditions to permit the full success of the transition. that being said, it remains absolutely remarkable that the real progress made in reducing inflation expectations in the core currency area in the few months leading up to the final decision over emu participation in may 1998 was fully preserved at the moment of the transition and afterwards. i would suggest that economic research continue to work actively on the question of the optimality of the transition. after all, the setting up of the euro is historically the most important monetary reform of all times and this transition contains a wealth of information and lessons that have not yet been fully explored. anchoring solidly inflation expectations at a low level at the birth of the currency was a success. but credibility is never gained once and for all. it has to be permanently preserved and enhanced. that is the reason why for central bankers vigilance is always of the essence. to exert vigilance effectively and efficiently the anchoring and monitoring of inflation expectations, particularly on the long end of the time horizon, are both very important. let me elaborate a little bit on that. we know that excess volatility of expectations can be signalled by abnormal developments in monetary and credit conditions. this is likely to be the case when unsustainable surges in asset prices – propelled by flights of optimism, and sustained by unanchored expectations – are built on conditions of excess liquidity. the drifting of expectations away from the central bank objective toward chronic inflation or debilitating deflation has historically very often been associated with monetary imbalances foreshadowing and facilitating the process. so, broadening the scope of macroeconomic analysis to include a systematic monitoring of monetary and credit developments can offer a