to price stability helps anchor inflation expectations and affords the central bank the flexibility to adjust monetary policy to support output and employment adjustments in the face of economic disturbances. flexible inflation targeting what i have just described is the modern textbook view of how to conduct monetary policy. it is commonly referred to as flexible inflation targeting. this approach combines a credible commitment to a medium - term inflation objective, which, in turn, allows monetary policy to adjust to economic shocks in a manner that helps promote the return of output or employment to a more desirable value without undermining inflation expectations. it emphasizes clear and transparent communication with the public about policymakers ’ views of current economic conditions, the economic outlook, and its decision - making framework. flexible inflation targeting is widely practiced by major central banks around the world. while details often differ, key themes include a commitment to an explicit medium - term inflation objective and transparent communication about the economic outlook, the policy process, and how policy decisions relate to changes in economic conditions. it is important to recognize that by being more explicit about its objectives and more transparent and systematic about its decision - making framework, the central bank enhances its credibility. this also increases its accountability to the public. it is harder to make commitments that you will be unable or unwilling to keep, if you know the public can call you to task for failing to meet your commitments. improving the federal reserve ’ s monetary policy framework the federal reserve has not explicitly adopted a flexible inflation targeting framework. indeed, monetary policymaking in the u. s. has historically been conducted on a highly discretionary basis, and the fed has resisted adopting a specific framework or numerical objective. yet, over the last two decades or so, fed policymakers have gradually taken steps toward the more mainstream approach of flexible inflation targeting. in particular, the fed, especially under chairman bernanke, has become increasingly transparent and has worked to improve its communications with the public and the markets. it has recognized and stressed the importance of keeping inflation expectations well anchored. it has become more transparent regarding the committee ’ s economic outlook over both the short and the intermediate term through the publication of its summary of economic projections, or sep for short, which is published four times a year. all of these efforts have moved us closer to having an explicit monetary policy framework. of course, such a framework does not solve all of our difficult policy choices. a good deal of judgment needs to be used in setting appropriate monetary policy. still, having an explicit framework within which

gent sejko : future balkans - towards a global inclusion speech by mr gent sejko, governor of the bank of albania, at the tirana economic forum " future balkans : towards a global inclusion " leadership, institutions and policies convergence 2017 - 2020, tirana, 24 january 2018. * * * your excellency mr president, your excellency deputy prime minister of albania, your excellency deputy prime minister of kosovo, honourable minister of finance and economy, my fellow colleagues and honourable participants, it is a pleasure for me to participate at this conference, convened to discuss on the importance of regional integration, which should be promoted by a forward - looking leadership and supported by the policies convergence. i believe that the dialogue that focuses on sharing our vision for the future, the convergence of perspectives about the challenges ahead of us, and identifying the objectives and drafting agendas for joint action, will be a fruitful dialogue to all of us. policy convergence, both within and between countries, promotes efficiency and minimizes negative spill - overs. the role of institutions in the growth and development institutions are the backbone of any modern society, in as much as they generate and implement laws, regulations and policies of development, thus laying out the rules of the game in a market economy. from a broader perspective, these rules should provide for a stable and transparent environment, thus enabling a predictable and long - term decision - making process. they should promote fair competition and equality of opportunities, and they should engender fairness and social cohesion. it is clear that richer economies and stable societies tend to have stronger and more stable institutions. it is, therefore, my belief that our region should not subscribe to an ‘ organic model ’ of institutional growth. by ‘ organic ’, i mean a growth model where institutions catch up to economic development, and tend more to ensure a certain level of prosperity rather than instigate it. to the contrary, i believe institutions and policies should lead the growth and development processes. in this context, our task as policy makers is to define goals, to identify impediments, and to undertake the required countermeasures. this, in essence, is the role of leadership. let me illustrate my point with just a few examples of the challenges facing us as a region : first, problems with the business environment, including corruption and informality, rank high on the list of growth impediments, both in albania and in the region. second, our