jurgen stark : financial stability – the role of central banks. a new task? a new strategy? new tools? speech by mr jurgen stark, member of the executive board of the european central bank, at the frankfurt 12th euro finance week, session on “ restructuring the global financial architecture – the road ahead ”, frankfurt am main, tuesday, 17 november 2009. * * * introduction it is a great pleasure for me to participate in the 12th euro finance week conference which brings together such well - known experts in banking and finance. the subject of my talk, “ financial stability – the role of central banks. a new task? a new strategy? new tools? ”, will not have come as a surprise. but i should perhaps warn you that you should not be surprised either, if my answers to these questions sound rather sober to you. the severity of the economic crisis demonstrates the need to profoundly improve the functioning of the global financial system. central banks have an important role to play in making this process a success. public expectations appear to be running high on how central banks will cope with what has come to be perceived as a whole range of new tasks. where do we stand? recent economic and financial information is encouraging. the free fall in economic activity has stopped and there is hope that the global recession has bottomed out. the recovery of global trade, the rebuilding of inventories and the positive impact of policy stimulus and liquidity support measures are, at the moment, the main drivers of economic activity. moreover, money market tensions have eased, government and corporate bond spreads are declining, and stock market volatility has fallen. yet, even if confidence is slowly returning, uncertainty remains high, and economic activity and employment are likely to remain volatile for a while. are these favourable developments in economic and financial conditions genuine improvements, or are they due only to supportive fiscal and monetary policies? is the economy on a path of sustainable recovery? finding answers to these questions will demand a very close and ongoing monitoring of all economic and financial market developments over the period ahead. there are still a number of uncertainties involved, and these uncertainties will not simply resolve themselves over time. the answers largely hinge on the success of the measures taken in response to the crisis, and on the need for their being phased out in a timely manner. the response to the crisis should not sow the seeds for new imbalances. after extended discussions, we are moving closer to phasing out our liquidity measures

david dodge : monetary policy report update opening statement by mr david dodge, governor of the bank of canada, at a press conference following the release of the monetary policy report, ottawa, 18 october 2007. * * * today, we released the october monetary policy report, which discusses current economic and financial trends in the context of canada's inflation - control strategy. since the july monetary policy report update, and against a backdrop of robust global economic expansion and strong commodity prices, the canadian economy has been stronger than projected. it is now operating further above its production potential than had been previously expected. since the july update, the outlook for the u. s. economy has weakened. the canadian dollar has appreciated sharply, and credit conditions have tightened. despite these tighter credit conditions, the momentum of domestic demand in canada is expected to remain strong. the combined effect of a weaker u. s. outlook and a higher assumed level for the canadian dollar implies, however, that net exports will exert a more significant drag on the economy in 2008 and 2009 than previously expected. as a result, canada's gross domestic product is projected to grow by 2. 6 per cent in 2007, 2. 3 per cent in 2008, and 2. 5 per cent in 2009. with the economy moving back towards balance, and with the direct effect of the stronger canadian dollar on consumer prices, core inflation is projected to gradually decline to 2 per cent in the second half of 2008. total cpi inflation is expected to peak at about 3 per cent later this year and then move back down to the 2 per cent target in the second half of 2008. but there are a number of upside and downside risks to the bank's inflation projection. the main upside risk is that excess demand in the canadian economy could persist longer than projected. the main downside risk is that output and inflation could be lower if the canadian dollar were to be persistently higher than the assumed average level of 98 cents u. s. for reasons not associated with demand for canadian products. all factors considered, the bank judges that the risks to its inflation projection are roughly balanced, with perhaps a slight tilt to the downside. the bank also judges, at this time, that the current level of the target for the overnight rate is consistent with achieving the inflation target over the medium term.