and even from one period of time to another for the same country. first, it is important to note that in the design and implementation of monetary policy, the understanding of structural changes is essential since the impacts of monetary policy decisions in a given economy depend on its structural changes and macroeconomic environment 2. on the other hand, it is clear that emerging economies like turkey are subject to structural changes more frequently than any other developed economy. combining these two facts, central bankers in emerging economies face the challenge of modeling the economy properly and react accordingly. in addition, i believe it is not an exaggeration to say that subsequent crises and reform processes have largely defined the economic landscape of emerging market economies in the last twenty years. thus, uncertainty, which naturally exists in every economy, constitutes a real challenge for central bankers in many emerging economies because of their volatile and unpredictable structure. dear guests, what we have been experiencing in the turkish economy in the last five years can be classified as one of the clear examples of the impact of structural changes on an economy. first of all, after a thirty - year period of high and chronic inflation, inflation declined from 68. 5 percent in 2001 to 10. 26 percent in august 2006. this decline in inflation also made it possible to perform the currency reform at the beginning of 2005 and we dropped six zeros from our currency. second, we experienced high growth rates while inflation was falling. i can say that the turkish economy has left behind the boom - bust cycle of growth and has been growing for the last eighteen quarters consecutively. additionally, the sources of growth have changed, as well. third, the declining trend of the ratio of public debt to national income has contributed both to the fight against inflation and the relative stability in financial markets. all these developments through the decisive implementation of policies have reflected themselves in reducing uncertainty and increasing predictability, strengthening macroeconomic fundamentals, increasing resilience to shocks and changing the dynamics of the economy bringing the private sector to the forefront ; rising productivity, changing behaviors and increasing competition. all in all, it is clear that the turkish economy has been undergoing a structural transformation since 2001. after going through a deep structural transformation, it is safe to say that the turkish economy has gradually been normalized. according to our studies, the impact of decisions of short - term interest bis. ( 1998 ). “ the transmission of monetary policy in emerging market economies ”. bis policy papers no. 3. rates on inflation and on the economy

jorg asmussen : financial stability in europe and the progress towards banking union speech by mr jorg asmussen, member of the executive board of the european central bank, at the event “ the way forward for the eurozone and europe – a conversation with european policymakers ”, organised by the brookings institution and the center for the united states and europe, washington, 18 april 2013. * * * ladies and gentlemen, thank you for inviting me today to the brookings institute to share my views on financial stability and the progress towards banking union. financial stability in europe financial stability in europe has improved according to the global financial stability report and the stress for the euro area financial system has eased tangibly. for some in the market, the “ great risk normalisation ” is the overarching theme for trades and strategies this year. and broadly speaking, i think this trend is intact, in particular when taking into account the following facts, while financial fragmentation in europe still remains a fundamental concern : • there has been a marked reduction of spreads and yields of stressed countries ’ sovereign bonds. for example the yields for ten year bonds have declined for spain from a peak of 7. 6 % to currently 4. 7 % and from 6. 6 % to 4. 3 % for italy. • bank debt funding conditions improved early this year in terms of lower financing costs and increasing breadth of issuance across banks. • deposits of euro area residents in banks in stressed countries have increased by about 130 billion euro since august 2012. • target2 balances of the national central banks in these countries have declined by more than 200 billion euro, or about 20 % since their peak. • and finally, bank ’ s dependence on central banks liquidity intermediation is waning, to some extent as the early repayment of more than a quarter of the ltros shows. looking at the banking sector, the aggregate solvency position of euro area banks has been steadily improving. for large and complex banking groups, the median core tier 1 ratio reached 11 % at the end of 2012, up from 6. 8 % at end - 2008. notwithstanding this progress in improving resilience, capital buffers are very unevenly spread throughout the banking system. questions arise like : do we know enough about the true quality of banks ’ balance sheets and are the banks capable to absorb potential further losses? clarity about balance sheet valuation and recognition of unrecoverable losses would be helpful to bolster confidence in banks ’ calculation