borders, this claim to be the standard setter for all internationally active banks became more and more difficult to justify. during the 1990s and 2000s, the committee made good use of its core principles liaison group to seek advice from members outside the g10. the cplg ’ s contribution was highly bis central bankers ’ speeches constructive when basel ii was developed, for example. but as the size and importance of jurisdictions “ outside the tent ” grew, even this arrangement became increasingly untenable. and so, in 2009, the committee essentially stepped up from a g10 to a g20 foundation as it sought a truly coordinated response to the global financial crisis. indeed, we now have more than 40 organisations representing 27 member jurisdictions around the table. as a result, the committee ’ s coverage of global banking assets has gone from about 60 % to 90 %. this much greater inclusiveness lends, in turn, greater legitimacy and credibility to the committee ’ s standards, as they are now set by a process that is truly reflective of international markets. the fourth key influence is a more recent one – the shift in thinking from a micro - to a macroprudential perspective. for much of its life, the committee focused primarily on microprudential issues. that is not to say the macroprudential angle was ignored, but there was certainly a view – quite prevalent in the pre - crisis world – that if banks were individually stable, the financial system would itself stay upright. during the great moderation, little appetite existed for new tools and international regulations of a macroprudential nature, even if the committee could have foreseen all of the looming threats. the financial crisis brought home the lesson that financial stability could not be assured only through the use of microprudential tools. and so basel iii represents another important step in the committee ’ s development. basel iii has substantially enhanced the microprudential framework. and, in the countercyclical buffer, it has also introduced the first international agreement on a macroprudential tool. subsequent work on the framework for systemically important banks ( both global and domestic ) has further expanded the committee ’ s input into this relatively new field – a trend that is unlikely to be reversed. my fifth key influence on the committee ’ s evolution is also quite recent, and hence its eventual impact on the committee ’ s work is still difficult to foresee : its role in monitoring the implementation of committee standards. post - crisis, the

jerome powell : semiannual monetary policy report to the congress testimony by mr jerome h powell, chairman of the board of governors of the federal reserve system, before the committee on banking, housing, and urban affairs, us senate, washington dc, 17 july 2018. * * * good morning. chairman crapo, ranking member brown, and other members of the committee, i am happy to present the federal reserve ’ s semiannual monetary policy report to the congress. let me start by saying that my colleagues and i strongly support the goals the congress has set for monetary policy — maximum employment and price stability. we also support clear and open communication about the policies we undertake to achieve these goals. we owe you, and the public in general, clear explanations of what we are doing and why we are doing it. monetary policy affects everyone and should be a mystery to no one. for the past three years, we have been gradually returning interest rates and the fed ’ s securities holdings to more normal levels as the economy strengthens. we believe this is the best way we can help set conditions in which americans who want a job can find one, and in which inflation remains low and stable. i will review the current economic situation and outlook and then turn to monetary policy. current economic situation and outlook since i last testified here in february, the job market has continued to strengthen and inflation has moved up. in the most recent data, inflation was a little above 2 percent, the level that the federal open market committee, or fomc, thinks will best achieve our price stability and employment objectives over the longer run. the latest figure was boosted by a significant increase in gasoline and other energy prices. an average of 215, 000 net new jobs were created each month in the first half of this year. that number is somewhat higher than the monthly average for 2017. it is also a good deal higher than the average number of people who enter the work force each month on net. the unemployment rate edged down 0. 1 percentage point over the first half of the year to 4. 0 percent in june, near the lowest level of the past two decades. in addition, the share of the population that either has a job or has looked for one in the past month — the labor force participation rate — has not changed much since late 2013. this development is another sign of labor market strength. part of what has kept the participation rate stable is that more working - age people have started looking for a job,