One obstacle which has attained prominence recently is based on the almost mystic belief that the rate of interest has the power to offset far-reaching real effects – for example the effects on high-tech and related industries of the slowdown in the US, and the effect on tourism, construction, and agriculture of the security-related events – without our having to pay the price of a rise in the balance of payments deficit and accelerated inflation.
Above all we must bear in mind that price stability is a system based on habit, and it takes time to acquire new habits. What is financial stability? As awareness of the importance of price stability increased in recent years, so did worldwide recognition of the fact that a country aiming for sustainable growth must attain financial stability too.