on crossborder payments. first, i will outline some general points about the potential impact and benefits of the introduction of cbdc for processing cross - border transactions. second, i will aim to highlight this topic in the context of the eurosystem's work on a digital euro – the envisaged european retail cbdc. 2 cbdcs and cross - border payments given that there are correspondent banks and fintechs working on digital innovations as well, let me begin with a question. what would be the additional benefits of cbdcs in the area of digital payments? the introduction of cbdcs would facilitate a setup of new infrastructures for digital payments. on the one hand, this makes high initial investment necessary. on the other hand, once a cbdc is established with its new infrastructure, it could catalyse broad improvements in payment systems, including cross - border transactions – by introducing new message standards and shorter process chains, for example. 4 starting on a green field may be one major advantage of cbdcs. experience shows that, in particular, implementing common standards is not an easy task. take iso 20022, for example. 5 the international organisation for standardisation proposed this common standard for financial messages in cross - border payments in 2004. it will be probably more widely used in payment systems on a global level next year – 21 years after the initial proposal. this period feels even longer when you think of all the innovations that have taken place in the meantime – the first iphone was presented in 2007, the concept of a decentralised blockchain in 2008. however, to be able to reap the benefits for cross - border payment, interoperability between cbdcs must be ensured early on. to this end, central banks should already begin to consider the best ways for interaction in the planning phase. in my view, we have a historic opportunity to vastly improve cross - border transactions by making different cbdcs interoperable from the very beginning. indeed, a number of projects are already researching the best ways of making cbdcs interoperable. for instance, the bank for international settlement ( bis ) innovation hub in singapore and a number of national central banks in the indo - pacific region set up project dunbar to explore how a common platform for cbdcs could enable cheaper, faster and safer cross - border payments. 6 i am strongly in favour of a multilateral approach in this area, because this best serves the interests of all participants.

countries house price growth is coupled with strong mortgage growth. indeed, the strong price increases are making urban housing affordability a pressing issue everywhere in the world. for central bankers, responsible for financial stability, affordability may not always be their most important concern. however, extreme examples such as the san francisco bay area, silicon valley, where the average house costs €1. 5 million, show this can become a problem for broader economic wellbeing. as these areas are booming, many workers cannot afford to live there anymore. recently, we see books, research papers and newspaper articles documenting these consequences of decreasing affordability, social as well as economic. urban demographics are changing as a result. young, well - educated people are drawn to cities, often chasing a limited supply of housing. due to the housing shortage, middle - income households are at a disadvantage : too rich to qualify for social housing, not rich enough to buy a house. they need to rely on the rental market. however, if this market does not function well, as is the case in many cities, middle income families are forced to move away. moreover, the rise of major cities also leads to increasing divergence between these cities and more peripheral regions. at the same time, spillover effects cause prices to rise in areas directly bordering major cities. this ultimately affects the structure of economic development, which increasingly shifts to urban areas and away from the periphery. housing supply the lack of suitable housing plays a major role here. supply shortages in cities, and to a lesser extent in other parts of the country, are a main driver of current price rises. and as we know from past experience, strong house price rises can lead to overshooting. which is often followed by a correction. this price volatility does not remain confined to the housing market. in countries like the netherlands, with a high rate of home ownership and dependence on mortgage lending, house price volatility feeds into the real economy. the link between house prices and private consumption is very strong here. this symbiotic relationship causes booms to grow larger and busts to be deeper. a more balanced and suitable supply of housing is thus needed. this does not only mean owner - occupied housing, but also private rental, especially for middle - income households. as a dnb study pinpointed last year, they are put in a tight spot on the housing market. in our view, a larger mid - market private rental segment is the key to