philip r lane : the brexit discontinuity speech by mr philip r lane, governor of the central bank of ireland, to the 2019 european financial forum, dublin, 13 february 2019. * * * introduction i am pleased to address the 2019 edition of the european financial forum. currently, both policy officials and private - sector participants in the global financial system are confronted with a combination of cyclical and structural concerns. at the cyclical level, the recent revision in global growth projections and the downside shift in the risk distribution require a careful assessment of the likely duration of adverse shocks and the potential offsetting impact of some mitigating stabilising factors : this exercise will be aided by the arrival of the incoming hard data on macroeconomic outcomes in the first months of 2019. at the structural level, longer - term prospects depend on the traditional determinants of global productivity ( such as investment and innovation rates ), the steady - state cross - country distribution of national income levels relative to the frontier and demographic trends. in addition, climate change ( together with the international policy response ) will exert an increasing influence on the path for global output. 1 however, both short - term and long - term prospects are currently also subject to an unusually high level of uncertainty about the paradigms governing policymaking. at the global level, the primary focus is on the future of the multilateral policy framework underpinning international trade. within europe, brexit constitutes another paradigmatic shift : the departure of the united kingdom from the european union represents a disruptive event across many dimensions, including the operation of the single market. a full analysis of such paradigmatic events requires a multi - field integrated approach that draws upon history, political science, international relations as well as economics and finance. i will not attempt such a comprehensive approach in this speech : rather, i will focus on some of the implications of brexit for the irish economy and the irish financial system. the central bank of ireland has been focused on brexit risks since the announcement of the 2016 uk referendum. our work has focused on ensuring that : ( i ) the risks to the irish economy and consumers are understood ; ( ii ) regulated firms prepare appropriately for all scenarios, in order to protect consumers ; ( iii ) where necessary, the required policy and legal adjustments are prepared to counteract the cliff - edge risks of a hard brexit to the delivery of vital financial services ; and ( iv ) we perform our gatekeeper

of the national consumer price index. focused on its constitutionally mandated primary objective of price stability, the bank of mexico has set its policy interest rate taking into account, among other factors, how the cyclical phase of the economy may affect future inflation. hence, in the midst of the big contraction of 2009, the central bank lowered its policy interest rate from 8. 25 to 4. 50 percent, and in 2013 it has further reduced it to 3. 75 percent. in the last ten years, annual inflation has remained much lower than historical levels. this has been possible thanks to the support of a prudent fiscal stance, a prerequisite for the credibility of monetary policy in any country and, hence, something which should continue to be safeguarded in the future. in 2013, after a spike resulting from agricultural price shocks, annual inflation has recently fallen, reaching 3. 4 percent in september. as in previous years, medium - and long - term inflation expectations have remained relatively stable, though above the permanent target. in the future, several risks need to be assessed for maintaining inflation under control, including possible pressures from renewed financial volatility and new shocks from non - core price components. in any case, the governing board of the bank of mexico has repeatedly see, for example, oecd ( 2010 ), pisa 2009 at a glance, oecd publishing. bis central bankers ’ speeches stated that it will continue to be vigilant, acting in a timely way if shocks to relative prices could potentially contaminate inflation expectations and put convergence to the permanent inflation target at risk. concluding remarks to conclude, after a year of economic slowing, the 2013 third quarter has seen encouraging signs of improvement. the outlook for the mexican economy includes a recovery next year, although downside risks prevail, including an adverse external scenario and protracted difficulties for construction - sector restructuring. although domestic financial markets have operated in an orderly way in the face of changing international sentiment toward emerging economies, further bouts of volatility may pose some challenges to both inflation control and the strengthening of a recovery in the short term. finally, mexico ’ s current momentum in structural reform is highly promising, as both the changes approved and those under discussion seek to enhance productivity growth, a key element for underpinning greater long - term economic expansion. bis central bankers ’ speeches