s definition of price stability. this represents the strongest and most reassuring protection against a deflationary spiral, and it is the result of market agents trusting our commitment and ability to deliver price stability. our independence, our clear mandate and our precise definition of price stability have been crucial factors in maintaining inflation expectations firmly anchored during these challenging times. secondly, although central banks may be charged with additional tasks in the aftermath of the crisis, their primary objective must remain the maintenance of price stability. we cannot allow any conflicts of interest to arise. the high - level expert group headed by jacques de larosiere, former governor of the bank of france and managing director of the imf, has identified a number of weaknesses in the supervisory framework both inside and outside europe that contributed to the build - up of the current crisis. one of the group ’ s proposals is to give the ecb more responsibility for so - called macro - prudential supervision. this means supervision that aims to limit the risk of distress in the financial system as a whole, but does not extend to supervision of individual financial institutions. building on the de larosiere report, the european commission has recently proposed to establish a european systemic risk council ( esrc ), chaired by the ecb president. the ecb welcomes the commission ’ s proposal. establishing the esrc will substantially improve the present institutional arrangements for risk assessment at eu level. much of the work that will be done by the esrc also be useful for assessing risks to price stability. but i would also like to stress that maintaining price stability must remain the primary objective of the eurosystem. with only one tool at our disposal – the interest rate – we cannot achieve more than one objective. therefore, it is particularly important for any risk warnings from the new council to be translated into policy action by the responsible authorities as effectively as possible. the ecb cannot use its policy interest rate to mitigate risks that are not directly related to price stability. at the same time, price stability is the best contribution we can make to financial stability. my third point concerns the important role played by monetary analysis – and in particular the role of asset prices – when assessing the risks to price stability over the medium term. price stability is our primary objective, but this does not imply that we only focus on short to medium - term movements in inflation. any build - up of financial imbalances which could pose risks to price stability in the longer term could be overlooked under a restrictive short

mugur isarescu : meeting the challenges of volatility opening speech by mr mugur isarescu, governor of the national bank of romania, at the " meeting the challenges of volatility " conference, organised by the romanian financial analysts'association ( aafbr ) and chartered financial analysts ( cfa ) romania, bucharest, 27 march 2018. * * * distinguished guests, ladies and gentlemen, good morning and welcome to the national bank of romania. let me extend a warm welcome to our keynote speaker, ms. rachel lomax, a trusted, longstanding friend of romania. i am pleased to open today ’ s conference – meeting the challenges of volatility, organized by two prestigious professional associations, the romanian financial analysts ’ association ( aafbr ) and chartered financial analysts ( cfa ) romania, with the support of the national bank of romania. here, at the central bank, we always offer a friendly framework for debate and interesting topics. i will not go into detail about today ’ s topic, as i am sure that the panelists of the three panels will bring to discussion important inputs regarding : global markets volatility and potential risks for romania ( panel i ), lending, regulations and capital flows volatility ( panel ii ), and how the fiscal volatility endangers economic growth ( panel iii ). before introducing our keynote speaker, allow me to address a subject which is not part of today ’ s agenda, but is dear to our hearts. a hundred years ago, on the 27 th of march 1918, the union of the old province of basarabia ( bessarabia ) with romania was created. as we speak, the parliament of romania is holding a solemn plenary meeting dedicated to the before mentioned event. the national bank of romania had an important contribution during the first world war. therefore it chose to acknowledge the historical moment by issuing a set of numismatic coins in gold, silver, coppered tombac and brass dedicated to this union. on the obverse, in the foreground, there is an image of the building of the national council in kishinev where, on the 27th of march 1918, the union of bessarabia with romania was voted, while in the background, there is an excerpt from the union act ; the inscription “ romania ” in an arch, the face value “ 100lei, 10lei, 1leu, 50 bani ”, the coat of arms of romania and the year of