good times ” ( when the opportunity cost of doing so was low ), so now we have a sizeable stock to weather financial turmoil. in turn, the implementation of a sterilization policy to keep money supply in check enables us to count with domestic liquidity management mechanisms that have been tested and are now very useful for injecting money into the system, if necessary. it is just the same scheme working under different circumstances. this is also reflected in the foreign exchange regime, which has always worked to mitigate excessive volatility, avoiding abrupt fluctuations that could jeopardize the economy's financial stability. after this crisis, financial stability will definitely start to play a role it has never played before in the priority list of central banks worldwide. both developed and emerging countries have had to adjust monetary schemes focused on the interest rate as the single instrument to maintain stability. in fact, financial stability objectives were implicitly and explicitly added, and instruments were adjusted to new priorities. within this framework, many central banks have had to revisit their usual regulation, operation and intervention mechanisms. in this regard, the literature is lagging behind. if the relationship between economic theory and policy recommendations is reasonably well defined during “ normal ” times, in times of turmoil, this relationship becomes much weaker. we have reached a point in which economic theory is having a hard time keeping up with praxis. literature has shown results that are ambiguous or contrary to those produced by the usual “ technology ”, especially in relation to the approach that relies on the interest rate as the single instrument. the same applies to the managed floating exchange rate regimes. recent empirical papers that refined the analysis started by several academics argue against sharp fluctuations in the domestic currency, mitigating excessive volatility, especially in developing countries with rather shallow capital markets and limited access to hedging instruments. in our case, we have been fully consistent with our history, idiosyncrasy and, thus, with the instruments available. we can now claim that our strategy is so sound that it has enabled us to overcome four stress episodes in the past 20 months ( july - october 2007, april - june 2008, september - november 2008 and march 2009 ) and it has proved to be adequate to go through these hard times with unusual stability. despite the current scenario, and for the first time in decades, we are able to ensure monetary and financial stability for the argentine people.

the ministry of finance, along with the planned reduction in the budget deficit, will enable stabilisation of state finances. from the point of view of monetary policy, for us it is important that the elected strategy limits inflation risks arising from fiscal policy. fiscal policy impacts on monetary policy and vice versa, therefore it is important for us to have a regimen of ongoing consultation on this issue. and i hope that we will be continuing this dialogue once you have started ( and you practically already have ) work on the budget this year. last year the ministry of finance announced its plan to move to fiscal rule, and this year the transitional provisions for this plan have already begun. the bank of russia welcomes this decision. the move to fiscal rule will enable the russian economy to become less dependent on oil price fluctuations ; it will support macroeconomic stability and provide more predictability in policy making, as well as more predictability and reliability in the movement of interest rates in the economy. fiscal rule in conjunction with inflation targeting will enable stabilisation of the impact on the real rate of the ruble ; it will decrease the volatility of the ruble, which, though having already lessened significantly, nevertheless still poses a concern to russian production and business. 1 / 4 bis central bankers'speeches since february of this year, the bank of russia, acting as an agent for the ministry of finance, has been making purchases of foreign currency on the domestic market as part of the transitional provisions to fiscal rule. this is a mechanism to mitigate the influence of commodity market fluctuations on the russian economy, until such a time as these fiscal rules have been consolidated in the russian federation ’ s budget code. the bank of russia is acting so as to ensure that these purchases do not lead to an increase in the rate of the ruble. at the same time, the rate of the ruble remains floating, and continues to be influenced by market factors. however the impact of operations conducted on the nominal exchange rate is very limited, as the volume of monthly currency purchases will not exceed the volume of additional monthly budget oil and gas revenue from the excess of the actual oil price levels that are budgeted. i would also like to point out that the short - term inflation risks associated with the ministry of finance starting to make foreign currency purchases, evaluated by the bank of russia in its decision - making processes at the start of the year, have not been realised. clarity is extremely important for monetary policy, not only in